Houston energy companies don’t really need reminding that there’s a whole lot of natural gas up in Pennsylvania.
Never mind that the first commercial oil and natural gas wells were drilled there well before Spindletop. There’s an estimated 500 TCF of natural gas reserves in the Marcellus shale formation that a bunch of local companies have been drilling for over the last few years.
So when the Pittsburgh Regional Alliance visited Houston this week it wasn’t to get more E&P companies to start drilling there (although they’re not turning them away), but rather to get other pieces of the energy supply chain to expand there. That includes services companies and equipment makers, and even end users of natural gas like chemical plants.
The group even has a flier with the title: “Pittsburgh — the Nation’s New Energy Capital” (they leave out the ‘new’ in an online piece).
“We’re not trying to get companies to leave Houston,” said Dennis Yablonsky, CEO of the Allegheny Conference on Community Development, which is over the Pittsburgh group.
Rather, they need companies to deal with the ample amounts of ethane that are produced from Marcellus shale gas wells. Ethane is a valuable feedstock for chemical plants, but with relatively few users of it in the Pennsylvania area it can become more of a hindrance than a help.
So the question for Pittsburgh and the entire Marcellus shale region is whether to create the infrastructure to ship ethane to markets that can use it — such as Gulf Coast chemical plants, Chicago or Sarnia, Ontario — or to encourage the development of a domestic, regional chemical industry, said Murry Gerber, chairman of EQT Corp., a Pittsburgh-based exploration and midstream company.
“It depends a lot on if we are willing to rebuild the U.S. chemical industry,” which has largely moved overseas to markets where the costs of doing business were lower and natural gas prices cheaper and less volatile, Gerber said.
The pitch from the Pittsburgh group includes the educated workforce (think of all those Carnegie-Mellon/Penn State gear heads), lower cost of living, and deep and wide involvement in much of the energy industry — including coal, nuclear power, solar and wind.
But when I mentioned what appear to be signs of a backlash against the Marcellus shale boom — like Cabot Oil & Gas’ woes with state regulators, the outgoing governor’s call to stop leasing new state lands to drilling and the Pennsylvania-spawned anti-gas documentary Gasland– you’d have thought I’d trampled on a Steeler’s Terrible Towel. Even the trade publication editor sitting in on the talk got worked up.
The short answer (after the stuff I already knew about gas in the Dimock, Pa., water predating drilling, the difficulty of fracs reaching aquifers, etc.) was that those recent developments are lagging indicators and the acceptance of natural gas drilling has actually grown in the last six months.
The economic impact of shale development is spreading, says Kathyrn Klaber of the Marcellus Shale Coalition, and the industry is working with the state to update and strengthen regulations.
“We’re answering the question ‘What will it take to be a modern shale state? ‘” Klaber said.
And Gov. Rendell’s executive order this week was really a lame-duck governor expressing frustration with not getting a tax on gas production passed by the state legislature, the group said. The two candidates to replace him have indicated strong support for the industry.
“The Marcellus shale could be as important to Pennsylvania as the steel business ever was, maybe more so,” said Gerber.
Ethane’s a hindrance? What a nice problem to have. Can’t they at least use NGL’s like ethane to fuel turbines, until they get the pipelines & infrastructure to use it as petrochemical feedstock. Maybe they already are.
“Never mind that the first commercial oil and natural gas wells were drilled there well before Spindletop. ”
Wrong….
In 1846 – more than a decade before the Americans made their famous discovery of oil in Pennsylvania – Azerbaijan drilled its first oil well in Bibi-Heybat.
Pittsburgh has weathered so many expansion/contraction cycles in oil and natural gas that likely, this will be another one, especially if the economic projections of one well-known expert (a Mr. Berman) are correct.
Nuke Pittsburg
Davebo
Sorry, I meant to say in the U.S.
Was then Azerbaijan well considered commerical, however?
Davebo,
What kind of drilling technology did Azerbaijan use? From all the books that I have read the Titusville well was the first commercial well to be drilled for Kerosene….
“The pitch from the Pittsburgh group includes …. lower cost of living….” Maybe this is what they said, but I really find that hard to believe. Some landmen I know that have moved up there said the housing prices are ridiculous in comparison to Houston.
@Zilch,
There’s an “h” in Pittsburgh. We take it very seriously. Take a geography class before you post next time numbnuts.
Pittsburgh is a nice city and has a nice quality of life. I would move there in a heartbeat if a good job came along.
@SteelcitybloodTxsoul
This man is correct. There was push by the US Post Office to Americanize many city names. Pittsburg, TX in Camp County complied as did most other Pittsburghs of the day. Pittsburgh, PA did not.
and I agree with rational too, that is a very nice town. One of my good friends moved from there when he was a kid. He said the run-off during a rainstorm or the early snow melts would run black towards the rivers because of all the smoke stack soot rinsing off the ground.
Almost all manufacturing is gone and the place is pristine now. Great family style Italian restaurants all over the place too.
I just love the big ol’ chip on the shoulder that every native texan wears when someone claims they are the leader in something that someone in texas has already labeled themselves. Grow up, turn the other cheek, and move on.
Rational you are so correct. The hardcore texans will never admit that there are nicer places to live outside the state.
Hey Tom Fowler, who wrote your headline? Pittsburgh is known as the Steel City, not the Iron City. Iron City is actually a brand of beer that’s quite popular in…the Steel City.
Thanks, Linda. As you can see, we’ve updated the headline. Apologies for the error.
Hot air does not equate to energy.
Linda
I had some locals (granted they were long-time transplants) say they’ve heard the Iron City name, too. But maybe I was too willing to use it because of the brew. Incidentally i think they filed for Chp. 11 a little while ago. Ever since one can no longer find Iron City beer in Houston grocery stores.
I am sure DanMan is correct about the pollution back in the day. I probably wouldn’t have wanted to live there when all the heavy industry and pollution was around. But, then again, that is one of the things I really dislike about Houston. Smokestacks, refiners, etc., while we need them (unfortunately), they are not nice to live around. They really weigh down the quality of life for residents.
Anyway, another thing that Pittsburgh has going for it are the excellent research universities in the city. Pitt is great and Carnegie Mellon is one of the finest universities in the world (ranked 20th in the last ranking I noticed).
I love it. Pitts? I will say they did good things cleaning that city up. When I was a kid we’d drive to Pitts to get supplies for Dads barbershop. You couldn’t see downtown from a 100 yds away. Of course “The greatest recession” of the 1970s helped there. A small big city these days. Many people don’t realise its about as big as Austin people wise so supporting pro sports teams is not easy. Is it the best? I kinda find that hard to believe. It is a nice clean town though.
@rational…yeah pittsburgh is a nice city if you like freaking cold weather in the winter and black nasty snow
Iron City is still around. They were bought by Latrobe, who also make Rolling Rock.
My husband’s family is from Pittsburgh. It is a beautiful city. I would be willing to move there, but my husband absolutely refuses to move back. He said there’s no way he’d live through those winters again.
@RaiderDriller
I’ve lived in both and I like colder weather better actually. The summers in Houston are miserable. Snow is not fun in the city but at least it’s nice once you get out and the mountains around Pittsburgh are really nice.
It’s not the best place in the world (San Diego maybe?) but a nice, mid-sized city with a good infrastructure (subway, bridges, Amtrak, etc.), historic neighborhoods, nice architecture, lots of cultural amenities and the area surrounding it is beautiful. Overall, I think the quality of life in the city is great.
They can say it all they want, doesn’t mean it’s true.
As far as universities… Houston/Texas isn’t lacking. Univ of Texas, Texas A&M, and Rice University. Do these not count?
And doesn’t PA have a state income tax?
Pittsburgh??? Really? I know that Marcellus shale areas are booming, but the unions usually find a way to ruin things.
@Zilch,
There’s an “h” in Pittsburgh. We take it very seriously. Take a geography class before you post next time numbnuts.
+++
Hey numbnuts, I think a “who cares?” would be appropriate right about now.
I could care less if Texas is #1 in anything. Lived here my whole life, and don’t care what other states, cities, or countries think of us. What I wish Texas was LAST in was – having idiots from up north moving to a state and then criticizing and complaining and whining about the way things are there. Texans like things just fine, outsiders want to change it all. SteelCityMoron, you don’t have any Texas soul. That just doesn’t come with showing up here. Take your numbnuts and head back north.
Latrobe Brewing was bought by Anheuser Busch. They promised they would never shut down the Latrobe Brewery as part of the deal to get Rolling Rock to sell to them. But of course, once the ink was dry on the contract and the deal was done AB shut them down. Now Rolling Rock is brewed at one of the big AB regional breweries in New Jersey someplace.
I grew up about an hour north of Pittsburgh. Back in the 50′s and 60′s the smog there was pretty bad. Not a good place to live, but it was like Texas City or Pasadena, the ash and soot was the color of money. The union mills provided a good living for a lot of guys and their families until things started slowing down in the 70′s. Now I think there’s only one mill left open there, a small specialty operation that’s owned by the workers, IIRC.
When I was a kid there was a little ditty about the smog…….
Mary had a little lamb
It’s fleece was white as snow.
It followed her to Pittsburgh one day
And now it’s looking mighty gray.