Business

Jobs Return To The ‘Rust Belt’ Thanks To Shale

In less than 10 years the United States has gone from energy crisis to the leading natural gas producer in the world. This happened because of American ingenuity. Horizontal drilling has been around for over 50 years. Hydraulic fracturing is over 70 years old. When these two processes were put together we were able to unlock shale gas reserves around the country. We knew they existed. We just didn’t know how to release the natural gas in them until now.

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Rust Belt
By Veillantif (Own work) [CC BY-SA 3.0], via Wikimedia Commons

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The Shale Crescent USA Region is made up of the Ohio River Valley region in the states of Pennsylvania, Ohio and West Virginia. This is what used to be called the "Rust Belt". In 2010 the Shale Crescent USA produced 3% of US natural gas supply. Today it produces 30% of the USA’s natural gas. More important, a new Study by IHSMarkit released in March says, a new petrochemical plant built in the Shale Crescent USA Region would have a 4 times greater cash flow and save $3.6 Billion over a 20-year period, compared to similar plant built on the Gulf Coast. The Shale Crescent USA is now most profitable region in the world for a petrochemical plant. For the past 75+ years the US Gulf Coast has been the most profitable region for petrochemical plants. This major disruption is creating opportunity for the people of this Region and for the USA as companies from Asia and Europe look to relocate manufacturing and petrochemicals there.

This is a big deal but not surprising. The Shale Crescent USA is the birthplace of the modern petroleum industry starting with the Drake Well in Titusville, PA in 1859. The modern petrochemical industry was started by Union Carbide at Clendenin, West Virginia in the early 1920s. Places like Pittsburgh, Weirton, WV and Youngstown, OH were steel towns in the 1800s. Most of this industry went away and moved overseas as the United States oil and gas production declined in the 1970s and 1980s. OPEC became the world power in oil and natural gas.

Things have changed from the 1980s. The Marcellus and Utica in the Shale Crescent USA is now the largest natural gas field in the world. In the 1970s until 2010 our production potential was limited. The Shale Crescent needed natural gas from southwest pipelines to meet demand. Today, thanks to Marcellus and Utica production this Region is now an exporter of gas in all four directions. Natural gas is being shipped to Canada and the Midwest via new pipelines. The southwest pipelines have been reversed and Marcellus and Utica gas is being shipped south. Pipelines are being built to supply the southeast states of Virginia, North and South Carolina. Gas is also being shipped east to Cove Point Maryland where it is being shipped around the world to countries like India and Japan who desperately need it. What a difference a few years makes. Natural gas from the Shale Crescent USA is having a global impact. It is also having a local impact using this abundant resource to bringing manufacturing and petrochemical jobs back to the Region.

The Shale Crescent USA Region has a unique opportunity that is rare in the world. Manufacturing and petrochemical plants built in this region have the largest natural gas field in the world under their feet. They are also close to most of the demand for products in the United States. This can be a huge competitive advantage for them.

Shale Crescent USA (the non-profit non- government organization) was founded by a group of successful community and business leaders from Ohio and West Virginia to tell the world about this opportunity. Their mission is to bring high wage jobs back to the Region and raise the standard of living for the people living there.

The "Rust Belt" is going away as local companies expand and others from around the world learn of this opportunity. Asia and Europe are particularly interested because of their energy limitations. Europe was moving to renewables. They are starting to realize that renewables create only one product, electricity. They don’t even do that very well because they require over a thousand acres to do what a single Marcellus well can do in 10 or 20 acres. Most important, the feedstocks to create the products we use today from cell phones, to medical equipment, electric cars and even modern windmills and solar panels require petrochemicals from oil and natural gas that the USA is blessed with.

As jobs come back to the "Rust Belt" the entire country benefits from an increased tax base and less people on government support. US consumers are already benefiting from low oil and natural gas prices. Forecasts show very little increase in US natural gas prices. Estimates of US natural gas supply is in the hundreds of years based on today’s technology which will only get better.

History is repeating itself. The United States is now the leading world producer of energy. We lead the world in oil and gas production. We have changed global politics by taking power away from Russia and OPEC. We are selling natural gas to Eastern Europe that was solely supplied by Russia. Thanks to a little competition these countries are seeing lower energy prices. Using this energy advantage, we have the opportunity to become an industrial power again. We can create high wage career jobs and raise the standard of living of our people. With just a little creativity this can all be done not just protecting but improving the global environment. The World has changed for the better and America did it.

Article by Greg Kozera- Shale Crescent USA


Greg Kozera is the Director of Marketing for Shale Crescent USA www.shalecrescentusa.com . He has over 40 years of experience in the energy industry. Greg is a leadership expert with a Masters in Environmental Engineering and the author of four books and numerous published articles, including numerous presentations, radio shows and TV.

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