Springtime is Coming to Ohio
Things are heating up here in America’s Heartland, and we’re not just talking about the weather. Across Ohio, activity and excitement are building momentum with every new announcement of job creating investments and projects coming from Ohio’s energy industry.
It’s a fitting metaphor: Springtime is coming to Ohio.
As reported in the Columbus Dispatch, our state is enjoying the natural resources that could turn Ohio into an “energy powerhouse”. But of course, we already knew that. With the initial reports on production from a small sample of producing wells in the Utica Shale due on Monday, excitement grows as more and more companies are making investments in the state – investments that mean jobs and revenue for Ohio’s citizens.
This week, British Petroleum was reported to have invested $330 million in land-lease agreements in Trumbull County, bringing yet another ‘Ohio Player’ into the burgeoning Utica Shale. It’s more great news for the Mahoning Valley, with one township trustee describing the move as a “Godsend” to the region (BP’s $331M investment in Trumbull will spur growth in Ohio, leaders say, 3/28/12). Of course, long term Ohio residents are no stranger to BP who in 1987 purchased Standard Oil of Ohio, a former subsidiary of Standard Oil- the nation’s original oil and gas producer that was once the largest oil refiner in the world.
If recent developments are any indication, it seems the Utica Shale might just be poised to return Ohio as a national leader in energy development like it was back in the Standard days.
The BP move comes on the heels of another big announcement by Chesapeake Energy, one bringing a whopping $900 million investment over the course of the next five years. Partnering with M3 Midstream and EV Energy Partners, an affiliate of EnerVest, the natural gas processing plant project will bring a “critically important link in the … chain for the rapidly developing Utica shale,” according to Mike Stice, president of Chesapeake Midstream Development.
Just as Chesapeake and EnerVest add to their substantial investment in Ohio energy, MarkWest Utica opened the doors to their new regional office in Cadiz, Ohio on the heels of their $500 million development of midstream services.
Down the road in Massillon, folks are rolling out the red-carpet for Baker-Hughes Oilfield Operations and their $340 million in investment for a regional facility expected to bring 700 full-time jobs with salaries averaging $65,000 over the next three years.
Of course these are just a few examples of the significant economic activity that has been brought to Ohio over the past six months as natural gas producers, and other service and midstream companies, have turned their focus to the Utica. The Akron Beacon Journal recently wrote a great piece that provides a succinct summary of the investments that have been made in the Buckeye State in recent months. From the piece:
Among the companies signing leases or other deals to become players in an area stretching from Youngstown to Marietta are EnerVest Ltd., Anadarko Petroleum Corp., Devon Energy Production Co, Hess Energy, XTO Energy Ltd. (an ExxonMobil Corp. subsidiary), Chevron Corp., HG Energy, CNX Gas Co. Ltd., Range Resources Corp., Anschutz Exploration Corp., Carrizo Oil & Gas and Antero Resources.
The best part of all this activity is that everyday Ohioans don’t have to wait for the new economic activity to “trickle-down” to feel its effects. In fact, they already are. To enter the Utica Shale a company must build relationships with, and compensate landowners for access to their land and minerals. According to a recent economic impact study sponsored by the Ohio Shale Council, prices paid to acquire Utica Shale rights have reached all time highs in Ohio with bonus payments topping $8,800 in some cases with an average of about $2,500 an acre.
The busiest counties for recent leasing and acquisition have been Belmont, Jefferson, Noble, Guernsey, Monroe and Washington. Residents in these counties have been waiting a long time for some sort of economic revival, now it seems it may be waiting on their doorsteps. Already we have seen benefits to the state’s surveying, real estate, steel and manufacturing industries.
All of this activity has had a big role in helping Ohio’s economy succeed. Over the same period the state began developing the Utica Shale it went from 48th to 9th in the nation in terms of job creation .
It’s nice to look back over the last year and see the significant progress that has been made in putting Ohioans back to work, diversifying our state’s economy and attracting new investments all brought from the early development of the Utica Shale. It seems positive stories like these are poised to continue and the entire EID-Ohio team is excited to bring them to you as they occur.
Stay tuned Ohio, the best is yet to come!