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Shale gas could fuel economic revitalization
Hundred of millions of dollars are being invested in drilling equipment in the region

Tim Rudell
The old sheet and tube plant was once the biggest of its kind in the world. Then the steel industry all but died out in the Youngstown area and it was idled. Now, major parts of the facility are being rebuilt to make tubing for the new gas drilling technologies
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There is a gas exploration boom in eastern Ohio.  Drilling a mile or two down hits ancient layers of shale, the remains of lake beds and sea shores where the Appalachians now rise.  Fossil fuel is trapped there and an aggressive recovery technology can bring it up.  In part two of our series on “fracking, ”  Tim Rudell  of members station WKSU looks at some of the claims about what that could do for, and to, Ohio economically.

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The neighbors are together on Sally Lytle’s wide porch, a lush summer afternoon is becoming evening in the valley below.  It is a year ago, nearly to the day, and “fracking” and “the shale gas play” are in the news and in the lives of these rural Stark County landowners.  They’re being pressed by gas exploration companies to sign leases…and let the drilling begin. Molly Greco says she knows the gas is needed, for a lot of reasons, but wonders about claims she’s hearing for how much is down there:

 ”They’re saying this will give us fifty years of freedom from foreign oil, or something like that I read?...”

Kent State Geologist Neil Wells is a shale expert:

“You’ll read estimates of 500-trillion cubic feet of gas…which sounds like a lot, and is.  But maybe only 10% of that is recoverable.  The U.S. uses, typically, 23-trillion cubic feet a year, … which is also a lot.  So, if it’s 50-trillion cubic feet total, that’s two years’ worth of gas.”

But, Wells points out, technology changes, and more of the gas may be recoverable a few years from now.   That could make the shale layers under Ohio--the Marcellus and Utica–a factor in not only a national but a world energy supply problem.

Economic plusses

Looking back at the local and regional level, shale drilling already has had economic benefits. A massive old industrial site, Youngstown Sheet & Tube--once the world’s largest manufacturing complex of its kind--was effectively abandoned for decades.  Now V&M Star, part of a French corporation, is rebuilding much of it; spending two-thirds of a billion dollars and employing some 350 people.  Roger Lindgren retired as chief executive of V&M Star shortly after the announcement of the new plant and says the whole investment was in large part because of the demand for tubing for drilling. 

 ”Of course, the United States wants to become to some degree energy independent.  And this shale drilling offers that opportunity.  Because of the technology that’s employed it’s going to use a large consumption of pipe.  So we are building that mill to serve that expanding market in the United States.”

Tom Tomastik is a geologist for the Ohio division of gas and oil. He says a direct link between gas drilling and industrial development goes back a long way in Ohio, first with the development of Standard Oil and the oil industry in the 19thcentury, and then again with manufacturing expansions in the 1960s and 1970s….

“They drilled wells for the GE facilities.  They drilled well for the Lordstown plant.  And Ford up at Akron.  And Firestone had a number of wells drilled on their property.  And Stone Container actually had Stone Energy, which was theirown energy division.”

The economic costs

The first of the shales to become a regular part of Ohio’s drilling vocabulary was Marcellus shale. Under it is a layer called Utica.  Kent State’s Neil Wells says it is pricey to get to either one with the process known as fracking, drilling horizontally and then bursting open pools of gas with five million or so gallons of high-pressure water:  

 “Drilling a standard vertical well to get down to the Marcellus in the middle of Pennsylvania, you’d spend less than a million dollars.  To drill a typical horizontal well into the Marcellus, they figure that’s more like thirty-five million.  It’s not something a small company does on a small budget; and it doesn’t matter if they miss on the first couple of wells and don’t get much money out of it.  You’ve got to have heavy funding for this.”

So, the potential payoff of shale drilling must be big.  But, Tom Tomastik says, it’s not necessarily from natural gas, though that’s what drillers are talking about the most when approaching land owners for leases:

“The big thing to the Utica shale for a lot of the gas companies that we’re seeing now with an interest in Ohio is what they call the liquids production—crude oil production.  And obviously, with the price of crude oil hovering around the low 90 dollars a barrel, that makes that very much more attractive than the natural gas right now … which is depressed down around about $4-dollars to four-fifty per a thousand cubic feet.” 

Beware what you sign

Can wells be drilled for both gas and the other “wet” products down there?  Yes, and says Alan Wenger--the Youngstown attorney who specializes in gas leases--that’s why local landowners have to protect themselves with the deals they sign…and be wary of signing away too much, and be especially wary of a pitch he’s heard about recently.

 ”It appears that there is an active market developing where companies that I believe are affiliated with the deep drilling companies, are coming around and making attractive offers to people to buy all of their mineral rights.  And the landowner basically gets up front any consideration that they’ll ever get again from their minerals.  And folks see the dollar signs and they tend to think ‘I’m going to cash in, because no one knows the future, and they may be giving away rights for pennies on the dollar.”

Cost left to the public to cover?

On the front porch in Paris Township there is also concern about the public cost of this private industry’s work.

“What about out nice new roads?” asks Molly Greco.

Water weighs a lot. So do the massive pieces of machinery being trucked to remote drilling sites throughout eastern Ohio. Both can overwhelm small local roads.  In some cases drillers are putting up bonds to fix crushed pavement and broken culverts and bridges.  But, lawyer Alan Wenger says that far from covers it all for the tax payers:

“In some local government in Ohio they’re helpless in this situation.  Townships, for example, do not benefit from any permitting or tax type fees charged to this activity.  They get nothing.  And often these tiny township roads are roughed up.  These are major industrial style locations with hundreds if not thousands of tanker trucks going in an out and rigs that weigh unbelievable weights.”  

The greatest burden on the roads comes from the tremendous amount of water needed for fracking operations.    Geologist Neil Wells:

“Typically five million gallons of water are needed for a horizontal well, per well.  Basically, we’re talking about seven to eight Olympic size swimming pools.  So, it’s not like Lake Erie…for most of the streams around here that a minute or so of flow.  But, it’s not inconsequential.  You can’t just go up to a neighbor and say ‘mind if I plug into your tap?”  And if you pump it out of the stream all in one go, … a lot of people are going to be very unhappy.  And if you pump it out at a rate they don’t notice, it’s going to take you forever.  So they have to make arrangements.”  

Those arrangements include trucking water in from out of state, where drilling companies like Chesapeake Energy—the biggest of the players in gas exploration in our area—have agreements with commercial water providers.   But, the water can come too from deals made with local municipal water agencies, from Lake Erie, and from rivers and streams all over Ohio.  In fact, state lawmakers recently approved raising the limits on how much water can be taken from such sources. 

In part three of our “fracking” series we’ll look at that and other environmental issues.


Related WKSU Stories

Area landowners are signing over drilling rights in droves
Thursday, July 14, 2011

Listener Comments:

This article IS Corporate propaganda

Posted by: Robert Kucera (St Paul MN) on July 17, 2011 9:07AM
I cannot understand how you can write or produce a radio piece on this subject and not mention the other components of the fracturing fluid that get pumped in with the water. You are not serving the public interest by keeping these toxic chemicals out of the discussion, and the people who have to decide issues about their land use based on this story are missing half the picture. If the people in your story think the roads are the biggest worry, then they are woefully misinformed, no thanks to you. Please allow me to fill in the picture:

Fracking chemicals are toxic, secret, and when they're not finding their way into ground water via the injection wells, they are stored after use in huge ponds on the surface until they evaporate into the air. These ponds frequently spill their contents into streams, rivers, and lakes causing environmental damage and assorted human health problems.

Why is that so difficult to include in your story? As it is written, your piece is corporate propaganda. I expected better from NPR.

Posted by: David Gill (Youngstown) on July 15, 2011 11:07AM
I'm glad they didn't fall into the trap of discussing it here because the stories about fracking chemicals are exactly that, stories. Any negative claims about them fail to hold up under vigorous scientific investigation. Its fear mongering and NIMBY syndrome.
I also like how anything that disagrees with you is automatically "Corporate Propaganda."

Posted by: Christopher (South Euclid) on July 15, 2011 3:07AM
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