Friday, April 4, 2014

Utica Spending reaches $19 billion

I boasted in one of my first posts on the Utica Shale that investment in Ohio would far surpass any pork barrel infrastructure spending likely to be gained from the 2009 stimulus bill. From Congresswoman Marci Kaptur's web site during the heydays of green energy spending;
"Due in part to more than $50 million in legislatively directed projects, ( that's code for earmarks ) Northern Ohio is emerging as one of three major solar-energy centers in the Western Hemisphere. The 180th Air National Guard base boasts the largest solar plant of any such facility in America."
Wow! a whole $50 million. But Kaptur wasn't through. She managed to direct millions more in green energy grants into Toledo's solar manufacturing industry that has all but vanished. Hellava job, Marci!
So far investment in the Utica has reached $19 billion with no end in sight! Most of that money has gone into leasing, drilling and midstream infrastructure but a portion has been spent in other areas not exclusive to energy extraction and production. Things like motels to accommodate a highly mobile workforce represent a small but interesting segment. Guernsey County has 3 new motels with a fourth planned. These four hotels will add 327 rooms in the county, giving it about 1,100 rooms in total and adding to the county’s existing six hotels. Considering the county only has a population of about 40,000 that is remarkable.

This 76 room motel in Belmont County is operated by Sky Hospitality which also operates hotels in the Bakkan Shale, Marcellus Shale and Permian Basin, meaning that it was built especially for oil field workers.
Now for the proposed big projects.
  • Construction of a 45-mile natural gas gathering pipeline system for Hess Energy Corp.
    Scheduled to be operational in late 2014. Cost $125–150 million.
  • In Butler County construction of the Middletown Energy Center natural gas fired power plant that is expected to create 30 permanent jobs once operations begin in 2018. Cost $500 million. At some point I will spell out the advantages of gas fired plants over coal fired plants and the advantages run well beyond lower carbon output.
  • In Ashtabula County a 2,800-barrel-per-day refinery is expected to be operational by early 2016. It is expected to result in 30 direct jobs and 112 indirect jobs. Cost $200–300 million.
  • In Carroll County another gas fired power plant. Cost $800 million.
  • In Columbiana and Mahoning Counties 50 miles of gas gathering pipelines and a cryogenic natural gas processing plant in Mahoning County. Cost $390 million.
  • In Trumbull County, construction of a new seamless pipe mill. Cost $1.2 billion.
In addition to the above projects are two major pipelines that will move natural gas out of the midwest to the Gulf Coast. They are the Bluegrass and Appalachian pipelines. Spectra Energy's Nexus Project will move natural gas into Canada. There a literally hundreds of smaller projects that will spend billions over the next few years. They range from producing steel tubing in Youngstown and the old Republic Steel plant in Lorain County to construction of a LNG service station / convenience store in Cincinnati to more motels and vocational schools and to sundry office buildings and warehouses. This boom is going to last a long time!
 

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