Study: Rural Economies Booming Thanks to Natural Gas

There is a lot of rhetoric and misinformation that surround the process of developing natural gas from shale. One common misconception is that it only benefits the companies and the “lucky” landowners who receive royalties. In reality, this couldn’t be further from the truth.

Anyone living in Pennsylvania can drive down the street and see the benefits of shale gas development throughout their communities.  As evidence, the McKinsey Global Institute issued a study earlier this month that further demonstrates this. The Susquehanna Valley Center for Public Policy discussed the report:

Nationally, shale gas and oil has the potential to boost our nation’s gross domestic product by between $380 billion and $690 billion. Those are huge numbers and represent almost four percent of our estimated GDP in 2020.

Already the Marcellus Shale and related industries are responsible for 239,474 jobs in Pennsylvania, according to our state Department of Labor and Industry.

Not every industry has the capability to make such a substantial impact on our economy. When an industry, such as energy, does have the potential, we need to encourage it. The McKinsey report makes very clear the upside, game-changing opportunities of shale gas and oil production. We would do well to encourage such a stimulus.

We can break down the tremendous economic impacts from natural gas development across communities in the Commonwealth even further – impacts that, without shale gas development, might not have been possible.

Shale Boom Transforms Library

The Freeport Area Library Association Board of Directors recently unveiled a new technology center that was made possible because of the areas increased shale development. Through a generous $25,000 donation from NiSource Midstream Services, a Columbia Pipeline Group company the association was able to upgrade the facility.  Upgrades included four new computers, state of the art equipment, electrical updates, new flooring and new walls.

“One of the great stories about our work in the area is the local talent, the local labor and the local manufacturers, suppliers and businesses that are supporting the work that we’re doing.” – Chad Zamarin CEO, NiSource Midstream.

It’s clear that without the industry stepping in, this facility may have never been completed. It’s projects like these that show the true reach of this industry in every community.

CNG Transportation

Compressed natural gas (CNG) as a transportation fuel is something that everyone has been hearing about, especially recently.  Owning a CNG vehicle previously wasn’t feasible due to the lack of filling stations available. But now, people are beginning to research and even directly support the expansion of this important fuel. In fact, we are starting to see fueling stations pop up all over the Marcellus Shale region in Northeast and Southwest Pennsylvania.

Even Pittsburgh, which has a purely political ban on hydraulic fracturing, has opened a CNG station on Carson Street in Southside:

“I’m a big believer in markets. I believe the price competitiveness of CNG is going to elicit an appropriate response.” – Rob Mullin Executive Vice President, Cleopatra Resources.

CNG benefits everybody in the community because of its competitive price to traditional fuel sources. The picture below shows the types of savings we could all conceivably see at the pump.

FuelingLocations

 

An average size vehicle takes about 12 gallons of gasoline. When was the last time it cost you only $25 to fill a tank that large?!

Pittsburgh International Airport

The Pittsburgh airport has been making headlines lately because of CONSOL Energy’s contract to develop the underlying shale.  The amount of money received by the airport in royalties will likely result in critical upgrades to the facility, but the benefits are being seen even before any development has started. According to the Pittsburgh Post-Gazette:

“Effective July 1, landing fees paid by airlines that use the facility were reduced by 55 cents per enplaning passenger, from $14.66 to $14.11. That may not sound like a lot, but with 300 passengers on a plane and hundreds of flights per month, the savings add up.”

The upshot? Anyone travelling into and out of Pittsburgh International Airport will be seeing lower fees over the next five years, a direct result of responsible shale development.

Roads

We have been talking about the work being done to roads for years.  As the industry moves into new areas, roads are repaired and maintained to allow not only for safer truck travel, but as a way of making sure that companies leave areas better than they found them. Normally the funds used for this type of work would come from the taxpayers; instead, the oil and natural gas industry is now shouldering these costs:

“Three businesses we work with have spent more than $250 million on roadway reconstruction in the northern tier of Pennsylvania alone.” – Jeffrey Case, director of transportation at Rettew

Many times maintaining the roads in these areas are the responsibility of local municipalities who don’t always have the budget to get the job done.  But the oil and gas industry has stepped up to fix not only roads, but also bridges that otherwise wouldn’t be repaired.

Pennsylvania is a prime example of what can occur across the country as more oil and natural gas plays are discovered and responsibly developed.  The economic benefits extend far beyond property lines, touching every member of a community, including places like Philadelphia where there is no shale development taking place.

Shale is reviving our economy and will continue to do so for generations to come, which is something we can all benefit from – and Pennsylvania is a case in point.

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