Shale Development Drives Ohio Manufacturing Boom

President Obama is heading to Ohio today to tout the resurgence of manufacturing, and there’s no better place than the Buckeye State.  As he tours the ArcelorMittal steel plant in Cleveland, he will surely hear of all of the great manufacturing announcements happening throughout our state. These are certainly worth celebrating, as they’ve put thousands of Ohioans back to work.

What people may not realize, though, is that much of the growth in manufacturing — in Ohio and across the country — is due to increased shale development.

It’s fitting that President Obama is touring a steel plant, since steel has always been a very important industry for Ohio and the entire region.  Steel manufacturing took an unfortunate step backwards over the last few decades, but in the past few years, increased shale development in Ohio has actually helped reverse that trend.

In fact, a recent Bricker and Eckler report estimated that shale-related projects in Ohio have already topped $12 billion in investment.

Here are a few examples:

  • In the Mahoning Valley, Vallourec Star recently began operations last year. The $1 billion tubular steel pipe mill is supplying the oil and gas industry with small diameter pipe for well casing.  This investment has been a boon for Trumbull County, adding 350 good paying jobs for its residents.
  • Vallourec Star’s sister company, VAM USA, LLC, a manufacturer of premium pipe connections, is developing a new $57 million finishing plant in Girard. When complete the new facility will employ an estimated 100 full time employees.
  • Just down the road from where President Obama is touring, U.S. Steel is ramping up its operations due to increased oil and gas related business.  The company opened a $100 million, 325,000-square-foot mill at its Lorain plant to manufacture steel pipe for the oil and gas industry.
  • Ohio-based Timken – a manufacturer of mechanical components and high-performance steel – has started building a $225 million, 83,000-square-foot addition to service the oil and gas industry.

Nor is all of Ohio’s manufacturing growth confined to the steel market. Consider:

  • Just a few weeks ago, Legacy Measurement Solutions Inc. announced they will be moving into a 73,000-square-foot facility in Brookfield while creating 150 full-time jobs. The company will manufacture precision gas-measurement and processing equipment for the oil and gas industry.
  • Dearing Compressor and Pump, in Boardman, continues to see exceptional growth.  In 2004, the company employed 45 people.  Today, they employ over 180 people and continue to look for qualified welders and fabricators.  In order to meet the needs of their customers, the company has expanded from their original 35,000 square foot facility to having to build an additional 50,000 square foot space in 2010.  Today, they are looking to expand even more with a proposed 125,000 foot workspace to keep up with their orders.
  • Exterran opened its $13 million, 65,000 square foot facility in May of this year.  The company will fabricate production equipment for the oil and gas industry.  Once the company is in full operation, they will employ over 100 people.

These companies operating in Ohio are just a snapshot of how important the oil and gas industry is to the residents of Ohio, including the rebirth of manufacturing.

While President Obama tours the ArcelorMittal steel plant in Cleveland, let’s hope he recognizes the critical role that shale development has played in making this manufacturing renaissance a reality.

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