Ej 1013

faLL 2013 | VoL. 3 | issue 4

FUELING

FORWARD Fleets nationwide are switching to CNG // Page 16

faLL 2013 | VoL. 3 | issue 4

PUBLISHER’S NOTE

4 // Williams thrives in the marcellus The country’s largest pipeline company is setting deep roots in the Northeast.

T

here is a need for industries to start using our prodigious natural-gas supply for all it’s worth.

Gas production has sputtered slightly in the last year or so because end users are trailing behind the forces that pull the resource from the ground. // But the tide has begun to turn. Transportation companies are finding great value in running buses with compressed natural gas; electricty generators are starting the switch to natural-gas generators; and manufacturers are discovering domestic supply can aid in plastics production, promising factories’ return to U.S. soil. // At the NEPA Energy Journal, we want to shed light on the growth that is fueling Marcellus Shale production forward to be one of our country’s most valuable resources.

13 // meet seth Hallam

This young engineer has a bright future with Cabot Oil & Gas.

OUR TEAM exeCutiVe eDitor George Spohr proJeCt eDitor Dan Burnett reporter Jon O’Connell DesiGners Amanda Dittmar | Tina Murdock pHotoGrapHers Bill Tarutis | Fred Adams | Pete G. Wilcox | Jon O’Connell aDVertisinG exeCutiVe Trish Roe 570-970-7361 | proe@civitasmedia.com

2 // NEPA Energy Journal

28 // everybody Knows your name

Shop owners in quiet Montrose are mostly thrilled with natural-gas production around town.

14 // shale news 16 // the wheels on the bus 22 // Gas in a global context 24 // Create jobs for pennsylvanians 27 // Hold on a minute

RAPID EROSION CONTROL Manufacturing & Processing • 100 Bonnie Dr. • Jermyn, PA 18433 TRAILER LOADS IN STOCK - CUSTOM SIZES AVAILABLE!

CALL OR EMAIL FOR A QUOTE SAME DAY DELIVERY

FRANK BRENNAN - CERTIFIED SEDIMENT CONTROL

InletSoxx

Cell: 570-280-6700 • Email: Frank@Rapidpallet.com

TM

Filtrexx® InletSoxxTM are three-dimensional tubular sediment control and storm water runoff filtration devices typically used for storm drain inlet protection of sediment and soluble pollutants (such as phosphorus and petroleum hydrocarbons) on and around construction activities.

• Pre-Cut 10’ Lengths are easy to use • Easy Installation, Maintenance and Cleanup • Heavy Grade Mesh for Durability “SPECIALIZING

IN

DitchChexx

TM

Filtrexx® InletSoxxTM are three-dimensional tubular check dam devices used in storm water drainage ditches and small channels on or near land disturbing activities to remove sediment and soluble pollutants (such as phosphorus and petroleum hydrocarbons) present in storm water runoff.

• Pre-Cut 10’ Lengths are easy to use • Easy Installation, Maintenance and Cleanup

8”, 12” & 18” PALLETIZED FILTREXX SILTSOXX”

SiltSoxxTM is the original mesh tube filled with FilterMediaTM Use it instead of silt fence.

It’s the sediment control device that actually works.

It stops silt and sediment leaving your jobsite, and helps keep you in compliance.

SiltSoxxTM stops pollutants in two ways: by allowing water to temporarily pond outside the sock, and by cleansing water as it passes through the sock. Sediment is either filtered or settled out.

One more thing. Our Soxx Don’t Fall Down!

PRODUCT SILTSOXXTM, 8-INCH SILTSOXXTM, 12-INCH

COLOR GREEN BLACK

LINEAR FEET 150 FT/PALLET; CONTINUOUS 85 FT/PALLET; CONTINUOUS

USE HOUSE WRAPS, SITE BAND AIDS PERIMETER CONTROL Fueling Forward // 3

Williams now has about 300 employees and hundreds of subcontractors focused on marcellus projects that transport gas from wellheads to pipelines.

Jon O’Connell | NEPA Energy Journal

4 // NEPA Energy Journal

builds a throne in the Northeast Jon o’ConneLL | JOCONNELL@CIVITASMEDIA.COM

The Zick Compressor Station in Kingsley, Pa., sat quietly one sunny September afternoon. Half of its compressors had been off for about a week, and engineers blamed the stuttering natural-gas market for the declining demand.

But Williams operations managers said slow periods were expected when eight compressors of varying horsepower went online last March. In fact, Williams engi-

neers designed it that way.

The Tennessee Pipeline, operated by Kinder Morgan, feeds communities from the Gulf of Mexico to Boston. Soon it will be ready to receive natural gas from Cabot Oil & Gas wells in Susquehanna County, and, when it is, Williams will be ready with the power.

“You want redundancies,” said a Williams gathering technician, Joshua Urda. “You want to know

that if you need the extra horsepower, you’ve got it.”

The Zick station is rated to compress 455 million cubic feet per day (mmcf). At the end of September, it was compressing only about 150 mmcf-per day. Zick is one of Williams’ largest compressor stations in the Marcellus Shale region and it cleans and pumps gas only from Cabot wells. see pipeLine, paGe 8

Fueling Forward // 5

Phone: (570) 746-6262 • P.O. Box 741, Wyalusing, PA 18853 Fax: (570) 746-2075

80128692

6 // NEPA Energy Journal

World Class Living

* Turnkey Homes. We take care of everything * Custom designs to satisfy every detail * Flexibility in every design. Allowing for plan changes * Designs range from traditional and rustic to formal and elegant * Created from renewable resources ... offering environmental advantages * Energy Star Homes are 30% more efficient than conventional new construction

Contact us now to get started!

Back Mountain Log Homes is an authorized distributor of Alta Log Homes.

Alta Log Homes has been a leader in the industry since 1971 because it provides a top quality crafted home with the most extensive design flexibility in the industry.

Call For A

FREE Quote

570-388-6113 www.backmtnloghomes.com Fueling Forward // 7

wife that the Appalachians could be a place to settle down for good.

When he got to the Marcellus, Savage said Williams had no employees on the ground and little infrastructure in place. It had the Transcontinental Pipeline, or the Transco, which went online 50 years ago. The Transco spiders from the Gulf of Mexico to New York City, but Williams had no pipes running through the Marcellus Shale Play.

Williams now has about 300 employees and hundreds of subcontractors focused on Marcellus projects that transport gas from wellheads to pipelines.

LonGeVity

pipeline from page 5 partnereD to tHriVe

“We’re lucky enough to have a partner in Cabot,” said Ryan Stocker, operations manager at the Zick station. “A lot of our clients are backing off. $3.40 (per thousand cubic feet) is not really economically feasible.”

Cabot and Williams have a symbiotic relationship as one of the top producers of natural gas and the top mover of the product in the country.

A Cabot spokesman, Bill DeRosiers, said efficiency in how drillers extract the gas, and also Cabot’s good fortune in leasing

8 // NEPA Energy Journal

some of the richest regions in the state, have made it easy to ride out a low-gas-price climate.

Jeremy Zeman, a Williams northeast commercial development manager, said prices would have to get significantly worse for Cabot to cut down production.

“These wells perform so well that they can sustain $1 to $1.75 (per thousand cubic feet) to break even,” Zeman said.

Ryan Savage is vice president of operations for Williams’ New York and Pennsylvania operations. He moved from the San Juan Basin in New Mexico and decided with his

Western and southern gas wells start strong, Savage said, producing 50 million to 60 million cubic feet per day. But the drillers in the warmer climes have to cap the wells after three or four years, Savage said.

Pressure in the non-porous Marcellus is lower. One of the highest-producing wells, at its peak, produced about 45 mmcf per day in the Marcellus. But the Marcellus has longevity, Savage said. The lower volumes will continue to flow, some say, for the next 100 years.

The Permian Shale Basin in Texas continues to produce crude oil decades after developers discovered the petroleum deposits there. Forward-thinking develop-

natural gas burns cleaner, producing less carbon and almost no soot. ers hope the Marcellus Shale will mirror the Permian.

Zeman called the Permian “the gift that keeps on giving.” He said the southern oil fields, as well, continue to produce vast amounts

of oil, have paved the way for creative engineering.

“That kind of innovation will happen here,” Zeman said with an air of confidence.

a CaLL to innoVate

Williams CEO Alan Armstrong said the company’s most rapid growth is happening in Pennsylvania, and he is looking for new and clever ways to put gas to use. He said developing export terminals and trans-ocean pipelines are the next step for moving gas to a global market.

With new federal standards constricting electricity-generation companies, Armstrong seemed certain natural gas will take the lead producing electricity. Natural gas burns cleaner, producing less carbon and almost no soot.

Advanced emissions-capturing technology in coal-fired generators can help reduce carbon pollution when coal is burned to make electricity, but Armstrong said natural gas still outranks any coalcentered solution.

“As we move forward with higher standards for emissions, even clean coal is having a hard time keeping up,” Armstrong said.

Armstrong also has manufacturing in his sights. Natural gas can be broken down at a molecular level to make plastic.

Ethylene propylene is a byproduct of the stuff pumping up from the Marcellus and it’s a basic form of rubber. This inexpensive raw material coming out of U.S. soil could fuel manufacturers’ return to the country, when 10 years ago, the United States was written off as a petro-chemical producer because gas prices were too high, Armstrong said. And Williams is poised to bring the goods to the factories’ front door, Armstrong said.

“We’ve got the ability to provide jobs well outside the natural-gas industry,” Armstrong said. n

Bill Tarutis | For the NEPA Energy Journal

Williams Bar-B-Que ‘Brew Crew’ members Kara and Brandon pearson, left, Kim purdy prepare their food items at the Williams second annual BBQ Cookoff in nicholson to benefit the united Way. Williams, a long-time contributor to united Ways around the country, has donated more than $80 million to the volunteer organization.

LIVING UNITED

Williams has a long history of contributing to communities through United Way. For over 25 years, Williams has made United Way a focus of its charitable giving.

At a BBQ Cook-off event in September in Nicholson, Wyoming County, Williams’ sub-contractors and partners went head-to-head for the best BBQ ribs and brisket in the Marcellus Shale. Williams raised nearly $100,000 at that fundraiser.

Williams matches each dollar raised for the United Way groups. The eating’s pretty good, too, said Williams’ Marcellus Shale operations spokeswoman Helen Humphreys.

“One of the things the Marcellus has done, it has brought people from other parts of the country,” Humphreys said. “They’re bringing

bits of the culture with them. You’ll hear them boast about their BBQs. People take a great deal of pride in their BBQ.” Barbara Hasbini, a senior public relations officer for the company, manages Williams’ nationwide charity efforts. Hasbini said annually, the company donates to more than 200 United Way chapters in the communities where they work.

Williams matches every dollar raised by employee fundraising. Its contributions to the United Way alone top $4 million to $5 million each year.

This year, donations crested $80 million to the United Way, a nonprofit that finds practical ways to promote education, financial stability and personal wellness in countries around the world. n

Fueling Forward // 9

10 // NEPA Energy Journal

Marcellus Shale Environmental Sampling and Analysis

Establish a Baseline Before You Drill To DEFINE YOUR LIABILITY HawkMtn labs has the Integrated ďŹ eld Soil-Water-Concrete

& laboratory Services/Resources tonecessity sample-Analyze Conducting a Background Characterization is a to Ensure You Documented Environment – Due Diligence May andhave Document thetheEnvironment Providing youPrevent with a litigation - Know what is there before you are required to Remediate and Pre & Post Drill Environmental Characterization that is Clean-Up to Environmental Standards If a Spill or Release Does Occur. a legally solid defendable CertiďŹ cate of Analysis.

HawkMtn labs has the Integrated ďŹ eld & laboratory Services /Resources to sample-Analyze and Document the Environment Providing you with a Pre & Post Drill Environmental Characterization that is a legally solid defendable CertiďŹ cate of Analysis.

Soil

Soil Samplings & Characterization

Regulated Fill/ Priority Pollutant Parameter Water List Soil Sub-surface Contamination Investigation/Spill Delineation Background Monitoring of

Soil Sampling & Characterization Ground Water or Surface Water Delineation of Leaks & Spills Regulated Fill/ Priority Pollutant Parameter List Shallow Monitoring Well Installation Drill Cuttings & Residual Waste Characterization to Manage Sub-surface Contamination Investigation/Spill Delineation Flow Back and Production Water Drill Cutting Disposal Options Delineation of Leaks & Spills Analysis to Manage Disposal Options Drill Cuttings & Residual Waste Characterization to Spill Delineation Manage Drill Cutting Disposal Options Well Water & Drinking Water

Water

Contact us to learn how our Fully Integrated Services can work for you.

P: 570.455.6011 570.45 570 .455.6 .45 5.6011 5.6 011 F: 570.455.6321

Background Monitoring of Ground or Surface Water Field Water Sampling Shallow Monitoring Well Insallation Teams Flow Back and Production Water Analysis to Manage Disposal Options & Courier Spill Delineation Service Well WaterTeams & Drinking Water Field Sampling Trained & Fully OutďŹ tted with pumps, bailers, Portable PID 6 Channel Gas Meters, YSI professional Multi Probe Ground & Surface Waters Field Meters, auto composite samplers; GeoProbe 6620 and 5400 DPT Technology---Rubber track models, nuclear density gauges and GPS tracking.

Field Sampling Teams & Courier Service

D

IN ACCORD

AN WIT H

ACCR

TE

CE

ED

I

201 West Clay Ave., Hazle Township, PA 18202

www.hawkmtnlabs.com

L A B S

I NC

INDEPENDENT TESTING LABORATORIES

Manufacturing Excellence Dedicated Commitment Integrity Customer Satisfaction Ongoing Improvements

0$-25 (48,30(17 0$18)$&785(56 0$18)$&785(56 x &$6( x 7DNHXFKL x $WODV &RSFR x :DFNHU x 7UDN ,QWHUQDWLRQDO

0HGLFR ,QGXVWULHV &RQVWUXFWLRQ (TXLSPHQW 'LYLVLRQ 0DLQ %UDQFK 0DLQ %UDQFK +:< :,/.(6 %$55( 3$

7HO

/$6(56 752:(/6 &2035(66256 +<'5$8/,& +$00(56 75(1&+ %2;(6 %8&.(76 7((7+ &21&5(7( 6$:6 81'(5*5281' 722/6 %52206 75$,/(56 7$* $/21* 75$,/(56 '(7$&+$%/( 75$,/(56 (;7(1'$%/( )25./,)76 9,%5$7,1* 6&5((16 *(1(5$7256 /,*+7,1* 3/$176 5$00(5 3/$7( &203$&7256 &5$:/(5 /2$'(56 &203$&7 (;&$9$7256 (;&$9$7256 :+((/ /2$'(56 /2$'(5 %$&.+2(6 '2=(56 6.,' 67((56 $57,&8/$7(' 758&.6

3RFRQR %UDQFK 3RFRQR %UDQFK 5287( 6&+$)(5¡6 6&+22/ +286( 5' 67528' 7:3 3$

ZZZ PHG LF RL QG FR P H PD LO PHG LF R# PHG LF RL QG FR P 6 $/(6 6(5 9, & ( 5 (17$/6 3$5 7 6

G R. NOTO

Electrical Construction Electrical & Telecommunications Contractors

â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re On the Front Line for Youâ&#x20AC;?

When you need the services of a commercial electrical contractor, itâ&#x20AC;&#x2122;s critical to have a responsive, competent company, with a proven track record, by your side. Whether itâ&#x20AC;&#x2122;s new construction, maintenance, renovation or an emergency situation, G.R. Noto Electrical Construction can help.

2 Skyline Drive â&#x20AC;˘ Clarks Summit, PA 18411 (570) 586-1600 â&#x20AC;˘ www.grnotoelectric.com

Fueling Forward // 11

Leading a Responsible Energy Future ™

At Chesapeake, we strive for continuous improvement in everything we do. We’re finding energy and producing it smarter and more efficiently while reducing our environmental footprint. We’re dedicated to giving back to our communities and neighbors. This is our commitment to leading a responsible energy future.

8262 Times Leader NEPA Energy Journal_f.indd 12 // NEPA Energy Journal

1

10/3/13 10:01 AM

Jon o’ConneLL | JOCONNELL@CIVITASMEDIA.COM

MEET THE METER MAN

Seth Hallam stepped out of the classroom into a robust career with Cabot Oil & Gas

Hallam oversees production from the borehole to the pipeline connection.

The snaking pipes and elbows, interrupted by gauges and filters, are his kingdom.

An engineer peeked his head into Seth Hallam’s office asking about a shipment of flow meters for a nearby natural-gas well pad.

“I know I ordered them. I can show you the confirmation.” Hallam replied. “They’re probably sitting in the warehouse somewhere.”

From the hallway, the engineer quipped back a muffled response suggesting Hallam never really ordered the meters. Hallam chuckled at his co-worker’s jargon-laced jest and plopped into his chair.

The playful morning scene was a typical day in the gas biz for Hallam.

The 25-year-old production engineer works out of Cabot Oil & Gas’ Dimock office to oversee the company’s well-pad construction and maintenance.

He shuffles around the field office in weathered loafers, slipping on his steel-toed hiking shoes when it’s time to inspect well pads.

He grew up in Akron, Ohio, an only child who spent as much time as he could outside.

He directed maintenance at a YMCA camp on a sprawling estate, and it was there he resolved to land a job someday under the open sky.

Fred Adams | For the NEPA Energy Journal

seth Hallam, an engineer working for Cabot oil & Gas, points out future well sites on a map in his Dimock office.

“I really liked working outside … having the freedom of being outside,” Hallam said.

At a career fair in high school, without much direction for achieving his goal, he learned about natural-gas production, which was barely a whisper at the time in Dimock.

Energy interests were a few years away from discovering the vast stores of gas locked inside the Marcellus Shale play.

While the Marcellus lay quiet, Hallam went to school armed with academic scholarships. He started studying at Mercyhurst University in

Erie and later at West Virginia University, earning a bachelor’s degree for natural-gas engineering.

Hallam admitted he doesn’t spend as much time out in the field as he hoped, but the work is rewarding enough. He spends most of his days problemsolving with engineers who are out on the ground and monitoring active wells from his small command center. He offers his opinion on tricky questions and works with other engineers to meet safety standards.

For his job, Hallam oversees production from the borehole to the pipeline connection.

The snaking pipes and elbows, interrupted by gauges and filters, are his kingdom. Some parts corrode faster than others, Hallam said. The constant barrage of sand and water from deep underground carried by gas at blinding speeds wears down parts much faster, so they take X-rays of the pipes often to test their integrity.

The field office is a repurposed medical clinic. Hallam looks forward to the new building, which is under construction next to its current building along Route 29.

Cabot boasts of having some of the highest-producing wells in the country. One of their most prolific wells, the Flowers II, pushed out about 44 million cubic feet-per day at its peak.

In other gas-producing states, developers rejoice at tapping wells that produce half that amount.

Buried behind a stack of hanging maps and drawings, Hallam revealed a single map of Cabot’s current and planned gas wells in Northern Pennsylvania.

The untapped wells yet to be drilled were marked in red.

They outnumbered producing wells 10 to one. It’s striking, he mused. “We’re only five or six years into this play.” n

Fueling Forward // 13

SHALE NEWS HARRISBURG

22 Pennsylvania counties.

“We are impressed this year $8.45 million earmarked with the diversity of quality for housing in shale region housing programs receiving funding, reflecting the impleThe Pennsylvania Housing Finance Agency wants to make mentation of local solutions it easier to find housing in the to housing challenges,” said Marcellus Shale region, so its PHFA Executive Director and CEO Brian A. Hudson board of directors has authorized grant money to empower Sr. “We’re also pleased to see counties taking a more agencies to do so. comprehensive approach to The funding for 34 housaddressing their housing ing programs and projects needs, which is the approach is being made available we want to encourage.” through the Pennsylvania “We expect this program Housing Affordability and funding to have a significant, Rehabilitation Enhancement positive impact helping counFund and Marcellus Shale ties address housing shortages impact fees. A total of $8.45 million is being distributed in resulting from the

development of gas drilling in the Marcellus Shale region,” he said.

HARRISBURG

Dep offers act 48 credit for efficiency courses Teachers will get a chance to boost their credits earned with a course offered by the Pennsylvania Department of Environmental Protection.

During 12 all-day workshops held at schools around the state, The Keystone Energy Education Program is a series of free sessions designed for teams representing middle schools. A school administrator, a teacher and a maintenance manager should make up each team. The workshops are designed to bring teachers up to speed on energy

technology as well as the latest in how to conserve energy in school buildings. The program intends to determine if schools are running as efficiently as they should.

Participating teachers will be eligible for 6.5 Act 48 credit hours. Space is limited to a total of 72 school teams eligible and registration.

HARRISBURG

new rules crank up safety standards The Pennsylvania Department of Environmental Protection and the state Environmental Quality Board has added new regulations for natural gas developers with the intent of protecting natural resources from specifically from

SERVING 20 PA COUNTIES

Microbiology, Inorganics, Metals Organics, Radiochemistry

Water Waste Soils Sludges Solids LABS: Center Valley PA | Sayre PA | Dayville CT OFFICES: East Stroudsburg, Honesdale, Williamsport PA

(570) 323-8286

www.benchmarkanalyticslabs.com

Complete Analytical Services 14 // NEPA Energy Journal

CLEARING THE WAY FOR PROGRESS.

SOUND FAMILIAR?

Mericle’s 50 member excavation team moves more material for area construction projects than anyone else in the region.

Our dozer and excavator operators, drillers, crusher and roller operators, material, water, fuel and low boy drivers, mechanics, welders, foremen, superintendents, and laborers work with surveyors, engineers, land planners, and project managers, using Mericle’s own equipment, to build roads, install utilities, crush stone, make topsoil, and get the job done faster and more economically than any other developer in the market.

INDUSTRIAL, OFFICE AND WAREHOUSE SPACE OUTDOOR STORAGE FLEXIBLE SHORT AND LONG TERM LEASES

mericle •com

DAN WALSH 570.823.1100

abandoned wells and leaking produced water.

Estimates show around 250,000 oil and gas wells drilled earlier in the century, before hydraulic fracturing, often were not capped correctly when they ran dry, some were not capped at all, classing them as orphaned or abandoned. Developers now must identify and monitor these abandoned wells if they are within 1,000 feet of the well head and plug them up if they are disturbed during new drilling.

New DEP and EQB rules also say produced water may no longer be stored in open containment ponds and liners for tanks and fresh-water pits must be of a minimum thickness. All pits and tanks must be protected from vandals, either by lock, fence or ‘round-the-clock security.

HARRISBURG

per year. The federal rules do not address or limit such emissions.

Rules for flaring gas have also grown more stringent.

At the beginning of August, Flaring, when gas companies the Pennsylvania Department burn off excess pressure with of Environmental Protection took air-emissions standards up open flames, is allowed only in emergencies and regular flara notch requiring drilling ing used for venting storage companies to align themcontainers must be enclosed. selves to an air quality Volatile organic compounds plan approved for well and hazardous air pollutants sites. are significantly reduced While federal rules call when this type of flaring is for leak detection and enclosed. repair plans for storage containers, the DEP’s ALBANY, N.Y. plan covers the whole Chesapeake ends well pad.

2-year lawsuit DEP also requires that Chesapeake Energy emissions of nitrogen has dropped its two-year oxides be less than 100 legal battle to force an pounds per hour, half a ton per day and 6.6 tons Dep tightens emissions controls

extension of 200 expired gasdrilling leases covering 13,000 acres in southern New York, the law firm representing the landowners said.

Oklahoma City-based Chesapeake had argued that it had the right to extend the leases beyond the five-year expiration date because the state’s moratorium on horizontal drilling and high-volume hydraulic fracturing has prevented it from drilling since 2008. U.S. District Court Judge David Hurd ruled in the landowners’ favor in November, but Chesapeake had appealed.

Chesapeake’s agreement to release the leases preserves the precedent set when Hurd ruled that the state’s moratosee sHaLe, paGe 18

IS YOUR DRINKING WATER HEALTHY & SAFE? Act Now Visit the Water Research Center at www.water-research.net • • • •

Free – Information on Drinking Water Quality Informational Water Testing Program by Mail Certified – Chain-of Custody Baseline Testing Related to Natural Gas Development

BF

Environmental Consultants, Inc

Mr. Brian Oram Professional Geologist, Water Expert, Independent Baseline Testing 570-335-1947 | bfenviro@ptd.net www.bfenvironmental.com

449 Commerce Rd | Vestal, NY 13850 607-798-0333 121 Armstrong Rd | Pittston, PA 18640 570-299-5505

Fueling Forward // 15

the

WHeeLs

ON THE BUS Jon o’ConneLL | JOCONNELL@CIVITASMEDIA

16 // NEPA Energy Journal 16 // nepa energy Journal

o

ne Pennsylvania town’s transportation authority is leading the charge to convert the nation’s public transit system.

Centre Area Transit Authority in State College has driven a stake in the ground in the debate over which comes first, the chicken or the egg?

Natural gas-powered vehicles need a place to refuel.

But without vehicles on the road to consume the gas, gasoline retailers have a hard time justifying pumps to provide the gas.

Legislators and innovators pushing for compressed natural gas, or CNG, as fuel for vehicles believe they can jam the cycle by setting up infrastructure to power vehicle fleets.

The state Department of Environmental Protection agrees. The agency is doling out money raised from impact fees to help vehicle fleets make the switch to compressed natural gas, or CNG. In a recent wave of Act 13 impact-fee disbursements, state agencies set aside $5.5 million for private and state transit companies looking to make the switch.

tHe poster CHiLD

A few miles outside State College, there’s a lonely Unimart gas station. It looks like nothing special, but for one feature — hardly advertised — that differentiates it from just about every other gas station in the state.

This Unimart has been selling CNG for more than 15 years.

The gas station is right next to the Centre Area Transportation Authority (CATA) bus depot, which started buying buses run by compressed natural gas in 1996. CATA runs a gas line from its compressor over to Unimart. The gas station buys it wholesale to sell to consumers.

Hugh Mose, the authority’s general manager, said neighbors saw little activity for the first decade, but it’s been increasing in the last two to three years. So has it grown for transit authorities: a development many say will make a reasonable commodity out of natural gas vehicles. see Bus, paGe 20

Fueling Forward // 17 fueling forward //

17

shale from page 15 rium wasn’t grounds to force an extension because it only precludes one type of drilling — using advanced technology of horizontal drilling and highvolume hydraulic fracturing to access gas trapped in shale deposits, Cindy Manchester, lawyer for the landowners in Broome and Tioga counties along the Pennsylvania border, said Monday.

Chesapeake’s action allows the landowners to seek better lease deals with other energy companies, or to keep drilling off their land. The leases were signed at $2 to $3 an acre and 12.5 percent royalties before the shale gas boom took off in 2007 across the border in

Pennsylvania and boosted land prices to thousands of dollars an acre with royalties of up to 20 percent on production.

since 2008 in Texas, Arkansas, Colorado, Ohio and Oklahoma, ranging from magnitude 3.3 to magnitude 5.7. Their locations show that human-caused MORGANTOWN, W.VA. earthquakes are geographically Deep injection wells widespread and geologically linked to ohio quakes diverse, but “very rare,” given the amount of petroleum proA University of Texas seisduced and the amount of waste mologist has evidence to show being disposed of. inconveniently placed deep Why some injection wells injection wells have been causcause earthquakes and others ing earthquakes around the don’t remains unclear, he said. country, not the practice of Frohlich hypothesizes that hydraulic fracturing. quakes occur when a “suitably When the rare human-caused oriented” fault lies near an injecquakes do occur, they’re typition site. cally linked to the disposal of “Hydraulic fracturing almost drilling fluids in underground never causes true earthquakes,” injection wells, said the scientist he told the group gathered for the National Research Council Cliff Frohlich.

Frohlich cited six earthquakes

workshop. “It is the disposal of fluids that is a concern.”

Texas has 10,000 injection wells, Frohlich said, and some have been in use since the 1930s. That effectively makes the state a giant research lab for the shale-gas drilling issues now facing Appalachian states including West Virginia, Pennsylvania, Ohio and New York.

If injection wells were “hugely dangerous,” he said, “we would know.”

“Texas would be famous as a state that just rocks with major earthquakes,” Frohlich said.

“That is not true.” n The Associated Press contributed to these reports.

www.lindeco.com •Hydrostatic Testing Services •Gas Well Pad Construction •Water Draw Construction •Compressor Station Construction

18 // NEPA Energy Journal

•Marcellus Region Pipeline Construction •Horizontal/Directional Drilling •Water Transfer

Scan with your smartphone to see our tencher in action

•Site Preparation •Rail Transload

Pittston Headquarters 570.299.5700

We’ll have to go through it Natural-gas producers Anadarko and Southwestern Energy have to be careful getting gas from under the pristine Loyalsock State Forest Energy companies holding the subsurface rights have requested access to extract natural gas below 25,000 acres of Loyalsock State Park.

Anadarko and Southwestern Energy Each own about 50 percent of the mineral rights below what is known as the Clarence Moore Lands.

The Department of Conservancy and Natural Resources must allow surface access to 7,000 of the 25,000 acres of the Loyalsock State Forest.

On 18,000 acres, DCNR can strongly influence but not prohibit subsurface owners from getting to the gas.

Each organization owns 50 percent of the subsurface rights. Anadarko already had approached DCNR about accessing those rights on the entire 25,000 acres but no conversations had occurred for almost a year.

DCNR has promised to protect wetland areas and minimize surface disturbance, though both companies

cannot be denied access.

In September, the Office of Open Records required Anadarko to share its development plans with the public, allowing them first to redact trade secrets and proprietary information about their processes.

“The decision of the Office of Open Records is a victory for transparency in government and for the Loyalsock State Forest,” said PennFuture staff attorney Mark Szybist. PennFuture had lead the charge for Anadarko to be transparent about its plans as the Clarence Moore Lands deed specifies DCNR has tight control of what happens on the surface.

“We hope that the DCNR and Anadarko will provide Anadarko’s development plan without delay so that the public can better understand the extent of the impacts and harms being proposed by Anadarko and DCNR.” Szybist said.

“Our main interest is protecting this resource. That is our mission.

It’s our job to balance the protection of habitat and recreational resources such as the Old Logger’s Path with the various uses of the state forest, including gas extraction,”DCNR Secretary Ellen Ferretti said.

Any development by the subsurface owners would also be subject to the required environmental reviews and permitting process with the Department of Environmental Protection.

Activists have staunchly opposed drilling in the state forest. In September, protesters from the group Marcellus Shale Earth First! gathered at one of the park entrances to cry out against Anadarko saying the delicately balanced ecosystem will be irreparably harmed if the Houston-based company produces gas there. n Fueling Forward // 19

Jon O’Connell | NEPA Energy Journal

a CnG fuel pump for public use sits ready to be installed outside the river Valley transit authority depot in Williamsport.

Bus from page 17 “A bus is the perfect vehicle for natural gas,” Mose said. “And a government organization has an easier time getting funding.”

Details of running a fleet on CNG: • Transit companies and government agencies have the capital to invest in new technology.

• Operators can help set up infrastructure for consumer vehicles.

• Bus roofs have plenty of space for fuel tank storage.

• Buses never travel too far from base.

• They park overnight when they can be refueled.

These factors put CATA in a strategic position for bringing in its vehicles about 17 years ago, just before Mose signed on as manager.

They have 66 active buses now;

20 // 20 //NEPA nepaEnergy energyJournal Journal

a small compressor station behind the depot; and 12 storage tanks to refuel the buses at night.

tHe CHamp

CATA had jumped in headfirst, buying 16 buses right out of the gate. “We paid the price of going first,” Mose said.

He credits much of their success to one dedicated mechanic who was willing to stick it out.

“To be successful, you have to have your champion. Ours has been Ed DelBaggio. He really kept us going during the early years when we were first finding our way,” Mose said. “He just took this under his wing. He really saved our bacon.”

DelBaggio might wear coveralls to work every day, and the cracks under his fingernails might always have grease in them, but he will always be remembered as the guy

who worked on CNG engines before manufacturers repaired them. He’s been 22 years with CATA. “We went from the stone age to the space age overnight,” DelBaggio said. “It was either learn the engines, or go find another job.”

While the engine function is similar to a diesel engine, the fueling system and electronic safety mechanisms took DelBaggio back to school.

In 1996, Detroit Diesel was the only company making CNG engines, and it sent its own mechanics to work side by side with DelBaggio to learn maintenance and repair procedures together.

“We learned from them. They learned from us,” DelBaggio said.

tHe rooKie Last

October,

River

Valley

Transit Authority in Lycoming County added a single CNG bus to its fleet with a slow-fill pump out back.

More recently, it received a $400,000 grant to upgrade fuel pumps on the condition they make the fuel available to the public. The CNG terminals will be unmanned at River Valley’s transit center along West Third Street in Williamsport.

“John Q. Public can come in with his credit or debit card and fill up right there,” said Kevin Kilpatrick, River Valley’s planning manager for the transition.

The pumps are to be online sometime in October.

Mechanics at River Valley have high hopes for the new buses. After a year running a single bus, they see promise in the small things, like routine maintenance.

“We don’t notice more miles per gallon, but we do notice when we

go to change the oil. At 5,000 miles, the oil is perfectly clean,” Kilpatrick said.

Kilpatrick revered CATA for its foresight, jumping in well before CNG was a realistic solution.

Like the State College authority, River Valley is now an exhibit for others learning the system. The bus depot is a few blocks away from Penn College of Technology, and students frequent the maintenance garage taking in what some consider the most difficult part of the transition.

Setting up a service garage bears great expense. Natural gas is lighter than air, and if there’s a leak, it will hover around the building creating great risk of fire or explosion. So the building must be loaded with sensors for leaking fuel. Adequate automated ventilation must also be a part of the alert system to meet state standards.

CLeaner, CHeaper aLternatiVe

CATA still performs its regular preventative maintenance as it did with diesel, rebuilding engines after 500,000 miles, but lubrication costs alone are significantly lower than other comparable authorities.

PennDOT measures lubrication costs per revenue hour. In 2012, CATA’s rounded off to less than $4 per revenue hour. Neighboring Blair County’s costs were nearly $12 per revenue hour.

CNG buses emit almost zero particulate matter, Mose said, they run quieter and drivers note little to no loss of power.

In 1996, CNG buses were promoted heavily at the Summer Olympics in Atlanta. CATA sent four buses to be used to help ease the enormous influx of people needing to get around the city.

The buses were hauled on flatbed

trucks and on the way back, there was an incident.

Mose said there has been great concern about the safety of alternative fuel, but what happened when a flatbed driver took an unplanned detour put him and his team at ease.

The flatbed driver underestimated his clearance and scraped the bus on a bridge causing the one of the roof-bound gas tanks to rupture.

Gas released into the air, but there was no fire and no explosion.

“It demonstrated to us … that maybe this is not as dangerous as we thought,” Mose said.

Natural Gas Vehicles for America, a national organization made up of energy and transit companies, estimates there are about 135,000 natural gas vehicles, or NGVs, used for public transit in the United States.

River Valley’s public-use pumps would open up opportunities for auto dealers to sell CNG vehicles for consumers. Ford, GM and Dodge produce trucks and vans for consumers. Honda is the only automaker to sell a consumer car, a Civic model, that runs on CNG. Dix Honda in State College started selling CNG-powered Honda Civics in 2012.

Fairfield Auto Group has a Honda dealership near the Lycoming Mall and one manager there said they have not started plans for selling the CNG Civic, but it seems like a logical step for them.

“We have to have our techs fully trained. It’s a matter of having the whole process in place,” said Fairfield’s general manager, Bill Resides. “It’s just a matter of figuring out the logistics to make that happen.” n

21

Fuelingforward Forward// // 21 fueling

Gas in a global context Guest Commentary Lou Barletta

U.S. House of Representatives

The civil war in Syria and the United States’ threats of force to punish Bashar al-Assad’s use of chemical weapons has highlighted America’s military and leadership role in the world, but also reminds us of the importance of a sound national policy for energy.

For decades, American leaders have had to weigh foreign policy and diplomatic choices with real concerns about the supply of energyproducing oil from the Middle East. It has often led to trading For decades, with nations which American leaders are not our traditional allies and left us subject have had to weigh to the per-barrel prices foreign policy that can fluctuate in tune with international and diplomatic unrest. choices with real When we have concerns about reached a time when a gallon of gasoline the supply of routinely costs more energy-producing than $3, it is time to oil from the admit that our national energy policy has Middle East. failed.

Far from the battle fields in the Middle East, high energy prices hurt families and employers and raise the costs of nearly everything consumers need to go about their daily lives. We are sitting on a wealth of natural resources right here in Pennsylvania that would allow us to be an energy leader in the world – not just in this country – and we can access it safely and cleanly.

I like to look at our energy solutions much the same way we used to have dinner with my parents – family style – meaning have some of everything.

There is no question that oil remains a driving force of our energy concerns and our overall economic well-being. The daily going rate for a barrel of oil can affect the price of everything, including a loaf of bread, based on the cost of production, delivery, and even the petroleum used to make the plastic bag.

22 // NEPA Energy Journal

It has been frustrating to me to see a project like the Keystone XL Pipeline delayed, despite extensive study, which has forestalled job creation and a flood of new oil that would pressure global perbarrel prices downward. The project can be done safely in conjunction with Canada, a trusted trading partner and source of oil for many years.

Benefits of pipeline I am pleased that as the fifth anniversary of the first proposal of the pipeline is upon us, there is a renewed bipartisan effort to see the project approved. The pipeline, coupled with a lifting of the moratorium on new exploration off our coasts, would improve our standing in global markets, create jobs and decrease our reliance on oil sources in troubled parts of the world.

Coal still produces more of the nation’s electricity than any other source and remains a driver of the Pennsylvania economy, as we are the fourth-largest coal provider in the United States. It would be a mistake to turn our backs on the industry as some in government and environmental organizations have argued.

Many of my Congressional colleagues from Pennsylvania and I sent a letter to President Obama urging the president not to strangle the coal industry with excessive regulations. In Pennsylvania, we know that coal means jobs, affordable energy and new exciting possibilities like clean coal technology.

Named for a small town in New York, Marcellus Shale has become an attractive source of natural gas in our region. It can be cleanly extracted by using the “fracking” process which injects fluids into the rock formation allowing natural gas to be collected. The deposit which Pennsylvania shares with other states would be enough to fuel the nation for 20 years and is worth as much as $1 trillion.

Natural gas extraction Marcellus Shale supports 234,000 jobs in Pennsylvania and companies involved

in the industry have paid more than $1.6 billion in state taxes since 2006. Using Marcellus Shale will make Pennsylvania fuel cost less, reducing prices of manufacturing and products and creating jobs.

Despite claims to the contrary, fracking can be done without harm to the environment. President Obama’s Energy Secretary, Ernest Moniz, said recently, “I still have not seen any evidence of fracking per se contaminating groundwater.”

More than one million wells have been hydraulically fractured nationally since the 1940s without a single case of groundwater contamination, according to an Environmental Protection Agency report in 2006.

As a father of four daughters and the grandfather of two children, I am certainly concerned about clean water and I am confident the practice is safe. Through extensive monitoring, regulation and improved technology, Marcellus Shale is an opportunity too promising to ignore.

In addition to fossil fuels, we should also pursue emerging energy sectors including wind, solar, biomass and clean coal technologies. These industries show potential and we should explore them, but not at the price of ignoring proven sources of energy we already know exist and are productive.

Along that vein, let us not continue to ignore the value of nuclear energy.

The United States has only just begun building the first two new nuclear plants since the 1970s, a glaring example of reluctance to embrace a safe, dependable source of electricity. Energy production does not have to begin and end with oil, coal and natural gas, and each possibility for production should be included in any discussion of a national policy.

Trouble spots in far off places in the world should not have undue influence on our domestic production and economic health. If we truly want to escape dependence on foreign sources of energy, we should embrace a policy like my own family served dinner – have some of everything. n

OIL & GAS LAW Oil and Gas Lease Negotiations Pipeline Agreements Surface Use Agreements • Litigation LLCs • Family Partnerships • Trusts Tax and Estate Planning Subsurface Deed Transfers OIL & GAS PLANNING: • Estate Planning • Management and Succession Plans for future generations • Liability Protection from well operations

450 Plaza Drive, Vestal, NY 13850 • Toll Free 877-548-9200 www.BinghamtonLaw.com

STAY SMART AT HOLIDAY INN EXPRESS® GIBSON

The Holiday Inn Express Gibson is a beautiful hotel located only 12 miles from Elk Mountain Ski Resort.

Experience the comfort and convenience of all its modern services and amenities. Stay Smart®...stay at Holiday Inn Express • Complimentary HOT • Business Center Express® Start Breakfast • Fitness room • Free Wireless high-speed • Restaurants nearby Internet Access • All guestrooms include • Indoor heated pool microwave and refrigerator

RATES STARTING AT

129

$

00

PER NIGHT PLUS TAX (Based on Availability)

I-81 at Exit 219 (Gibson) • New Milford, PA 18834 • 1-800-HOLIDAY • www.hiexpress.com/gibson Fueling Forward // 23

Create jobs for Pennsylvanians

Guest Commentary mark smith

Bradford County Commissioner Candidate for Pennsylvania Lieutenant Governor

24 // NEPA Energy Journal

Nearly three years ago, Moxie Energy proposed to build two natural gas power plants: one in Bradford County, and one in Lycoming County. Overall, the plants represent a combined $1.6 billion investment in Pennsylvania. Each power plant is expected to take 30 months to build.

These construction projects are expected to employ a peak workforce of approximately 500 workers per plant. We need to make sure Pennsylvania workers do those jobs.

Last week, a Dallas, Texas privateequity firm, Panda Power Funds acquired Moxie Energy’s planned natural gas power plant in Bradford County, PA. All too often we see out-of-state corporations coming to Pennsylvania but bringing out-ofstate labor to do the work. That practice costs our communities and our families money and jobs. The loss of over 1,000 Pennsylvania jobs would cost the commonwealth’s taxpayers over $15 million in unemployment compensation alone. Not to mention the loss of the positive economic impact our own taxpayers would have on the Pennsylvania economy.

These jobs can put workers back to work in a state whose unemployment rate stood at 7.7 percent in August.

Pennsylvania is ranked 46th in the nation for job growth. We can’t afford to lose these jobs.

From the beginning, as an elected official, I was told by Moxie Energy that these plants were going to create local jobs for local people. However, as of yet, no solid or binding commitments have been made

by Moxie or Panda Power to any of the skilled trades in Pennsylvania.

Furthermore, we have to be sure that a quality power plant is built. Pennsylvania workers, such as highly trained union boilermakers, electricians, carpenters, and many other skilled trades will be required to build this plant to the highest standards and with the greatest of care. Local workers who are building the plant in their own backyards, and who have demonstrated a true commitment to quality and to our community, are the ones I trust most to get this job done right.

We, as Pennsylvanians, need to put pressure on the administration to require Panda Power Funds to employ skilled Pennsylvania labor to do the job. Let’s put our people back to work so they can put food on the kitchen table, grow our local economies and decrease our state’s unemployment.

You can contact Governor Corbett’s office to express your concern by calling 717-787-2500. Pennsylvanians have to fight for each other and it starts with calling the Governor and expressing your concern. n

Horlacher &

Sherwood

Serving the Forestry And Natural Gas Industries With The BEST In Equipment, Parts & Service

THE WORLD’S QUIETEST, SAFEST AND COOLEST GAS COMPRESSOR STATIONS

Pittsburgh's 100 Fastest Growing Companies

Transport Trailers, Frac Tanks, Bob Tails,Tractors,Winch Trucks, Hot Shots, Or Vac Truck Parts Horlacher & Sherwood Inc, has what you need! Give us a call today and see what we can do for you!!!

Dragon Products, Stephens Pneumatics, Anderson Trailers, Pequea Trailers,Western Star, Freightliner, Elliot, Pik-Rite, Prebola, National Vaccuum SALES - PARTS - SERVICE

EQUIPMENT AND TRUCK SALES

Art Carpenter Office: 570-996-4692 • Call: 570-240-0713 Email: skiddershop@epix.net 1120 Washington Road/Rt 19, Washington , PA 15301 Phone: 724.225.2202 | www.steelnationbuildings.com

www.skiddershop.com

Fueling Forward // 25

GENmbro I Sg • E Drintin

r ide

np

Wisnosky Jewelers

e cre

Diamonds • Precious Metals • Gems • Engraving • Custom

Suite 1 26 // NEPA Energy Journal

wisnosky.com

P s•

g

s

Hours: M-T-W-F 9-5 • TH 9-7 • Sat 9-4 • Sun Closed

S l• a n tio igns o m S

ro

g

(570)836-5754

y•

ie ph

o Tr

n •E

in rav

Suite 7 (570)996-1666 wjlogodesign.com

230 West Tioga Street Tunkhannock, PA 18657

In June, the Pennsylvania State Democratic Committee passed a resolution calling for a moratorium on fracking until health and environmental concerns are more clearly addressed. Recently, this moratorium has been debated on both sides of the aisle in Harrisburg, but it appears politics in the debate about the safety of unconventional natural gas drilling has taken precedence over the science.

New York state is now in the fifth year of a moratorium on unconventional natural gas drilling. In New York, active communities, concerned about the lack of studies on health safety have taken the lead in demanding that science take precedent over economics and politics in pushing for a stay on the negative health and environmental challenges this industry presents. This is the right order to do business.

Both the industry and political supporters of natural gas advocate that we can become energy independent, especially from dangerous and unstable Middle East suppliers of oil.

Unfortunately, this claim fails on many fronts. As private corporations, the oil and gas companies have as their primary concern, profits for their shareholders, not energy security for the United States.

Supporting this fact, are the applications by the industry for liquid natural gas terminals currently at 21 different ports, four of which have already been approved.

Deborah Rogers, founder of the Energy Policy Forum, a consultancy and educational forum dedicated to policy and financial issues regarding shale gas and renewable energy, points out the inconsistency of this logic of becoming energy independent by shipping our gas overseas. She predicts the negative changes to our now cheap domestic natural gas, once contracts for supplying natural gas in open market are signed.

Of course, the industry and its political supporters tout the employment benefits from natural gas extraction.

This claim has not panned out as predicted. After 3 years of active drilling in the state, according to job creation data compiled by Arizona State University, from January of 2011, Pennsylvania has gone from seventh in job creation to

Hold on a minute

49th out of 50 states. This happened as Tom Corbett took over as Governor and became one of the biggest cheerleaders for this industry.

A growing trend in the Pennsylvaniaâ&#x20AC;&#x2122;s rural gas fields are decreased property values associated with either gas leasing or extractive activities. Not only have homes lost their value, with an associated lower future tax base, but the insurance industry has recognized the risks of gas drilling with difficulty in obtaining insurance and mortgages for these properties becoming a reality.

The most important reason for a moratorium is the lack of any quality health and environmental studies demonstrating the safety of this practice. The recently announced Geisinger health study is underfunded by millions of dollars and will take at least 20 years to collect and analyze the data on potential negative health effects.

Why do we need health studies?

Physicians and environmentalists are starting to track growing lists of individuals claiming harm from gas drilling activities. In addition, the Southwest Pennsylvania Environmental Health Project, a group located south of Pittsburgh, has attempted to monitor drilling-related health effects. They have found 27 cases of people who have experienced health problems in Washington County, where 700 natural gas wells have been drilled.

Air quality issues are usually the first to arrive with gas drilling. Several studies have shown air quality problems in cities having concentrated surrounding natural gas extractive activities. Towns in Texas, where gas drilling proliferates have shown childhood asthma rates at 25 percent, where the national average is 7 percent. Studies done in Erie Pennsylvania and in Colorado by the NOAA show significant air pollution problems.

There are growing concerns that unconventional gas drilling will result in water contamination. One draft study, done by the Federal government in Wyoming, and now abandoned, has shown that test wells revealed aquifer contamination from chemicals used in nearby fracking for natural gas. The EPA has also claimed

Guest Commentary Dr. Thomas Jiunta Spokesperson, Gas Drilling Awareness Coalition

that gas wells drilled by Range Resources have contaminated nearby well water in two homes in the Barnett shale region.

Similarly, another study originally finding contaminated water from gas drilling in Dimock, Pennsylvania has been abandoned by the EPA. These studies have originally shown evidence of fracking chemicals and methane migration in nearby well water. There are also studies from Robert Jackson from Duke University that show a higher likelihood of methane in well water the closer that well is to gas drilling.

The most damaging evidence implicating the need for moratorium on unconventional gas drilling in Pennsylvania comes from the scientific experts studying well casing failure rates. Dr. Anthony Ingraffea from Cornell University, a rock fracture-engineering expert who has studied this process for decades has shown that the initial casing failure rate on these natural gas wells is slightly over 6 percent. This alarming statistic, damaging in its own right, has remained consistently over 6 percent for the past 3 years in Pennsylvania, revealing the industry has made no real improvement in solving this problem of casing integrity. Estimates are that this rate will increase to 50 percent over the course of 15 years. Are these risks worth the gamble to our drinking water?

We have been inefficient in our energy use and have been slow in changing our excesses of energy consumption. We need to recognize that there are scientists who now have realistic energy proposals on the table to begin the conversion to alternative and sustainable wind, water and solar energy production plans using current technology.

Adopting these plans and turning our course away from dangerous fossil fuel extracting activities can lead us toward becoming truly sustainable and energy independent. Moreover, we cannot afford the cost associated with repetitive cleanups following increased damage from climate change related storms, secondary to our addiction to fossil fuels. We can create jobs and leave a legacy of clean air and water to leave our children by enacting a moratorium now on further unconventional natural gas extraction. n Fueling Forward // 27

e s o r t n Mo Marketplace Jon o’ConneLL | JOCONNELL@CIVITASMEDIA

CREATIVE BACKGROUNDS

A

surveyor once warned Dan and Gretchen Backer: “Be careful guys, because once we’re done, we’re gone.”

The Backers have built a small kingdom on the shoulders of the gas industry with 48 rental units spread around the picturesque borough of Montrose.

They were just beginning to invest in real estate, buying their first small apartment building in 2007. Back then, few in Susquehanna County had insight of the gathering force about to strike natural-gas reserves deep below the town. Montrose’s population of just more than 4,000 was largely made of corn and dairy farmers, and one famous alpaca farmer.

Gretchen Backer said she hasn’t put all of her eggs in the gas basket. She knows it will not flow forever, but she and her husband have resolved to make hay while the sun shines and now they seldom dip below a 90-percent occupancy in their short and extendedstay units.

Dan, a metal sculptor by trade, and Gretchen, a retired Army helicopter pilot who tried her luck in the craft world making handbags, met each other through the art community and now have a 2-year-old daughter.

They run the Inn at Montrose and four other rental buildings with a guest log filled mostly by gas workers. Backer said Cabot Oil & Gas has held two

apartments for more than two years. using it as a place for rotating workers to crash at night.

The halls upstairs in the Inn at Montrose are cozy, narrow, homey, and each room is a little different than the other. Backer laughed and said some rooms get pretty tight.

“We have one room where you have to step outside to change your mind,” she said.

From June to August, the Backers got a rude awakening when production sput-

tered and they had to drop their prices to keep beds filled. The entrepreneurs have to compete with three new hotels, 30 minutes south in Tunkhannock, that offer free breakfast and swimming pools.

“We can’t compete with that,” Backer said.

She said their residency bounced back late in August, but the quick return hasn’t totally restored their faith.

Backer said they are working with a five-year plan to pay off the properties and set reasonable goals that can be sustained even when the natural gas workers are gone.

The word “gas”gets mixed reactions in Montrose. The Susquehanna County town borders Dimock, where a long-fought battle over private water wells that were allegedly contaminated by hydraulic fracturing is ongoing.

A few still fight for government agencies to look into the effects of natural gas drilling, but, for the most part, the denizens of Montrose are ready for quiet and would rather not talk about it.

Gretchen Backer owns the inn at montrose with her husband, Dan. the couple have seen huge success in montrose as a result of the booming gas industry.

28 // NEPA Energy Journal

Stars that once shined clear at night are dimmer now because of light cast from well pads and compressor stations.

Holly andre and tom narville, employees of andre and son inc., review an order in the company’s hardware store.

Bridget mcnamara, manager, the White oak

FARM TO TABLE How far does the gas drillers’ reach extend?

The McNamaras would tell you it doesn’t much affect the kinds of customers they serve at their farm-to-table restaurant, The White Oak on South Main Street, where they prepare hand-picked food every night.

Bridget McNamara, the restaurant’s manager, said they

have about five local farmers who supply fresh meat and vegetables for their weeklychanging menu.

“I go to farmers markets every week. I never thought that would be part of my job,” said the 22-year-old Penn State graduate who studied physical therapy.

“Honestly, the majority of our customers are from Binghamton,” Bridget said, explaining that their kind of product draws from a specific

demographic willing to make the trip for farm-fresh food.

She used to wait tables for The Summerhouse Grille, a restaurant of the same strain that once occupied the same building. Her mother, Susan McNamara, who owns R.T Griffis & Sons Lumber, one day said she’d like to own a restaurant, about the time Bridget was getting out of school.

The long and all-encircling tendrils of natural gas have squeezed The White Oak in one small way, Susan said.

Many of the suppliers from whom they used to get fresh vegetables have shut down for some reason or another related to drilling, so now they have to travel further to fill their menus.

Susan said, if she could choose, she’d rather see Montrose thrive by way of farming and the arts.

Bridget shares her mother’s disdain for the industry. While drillers were laying deep

roots in Susquehanna County, Bridget was away at school.

Driving home after graduation was a big surprise as she took in the great change and industrial renaissance. Stars that once shined clear at night are dimmer now because of light cast from well pads and compressor stations, she said.

While their clients might not be the same steel-toeboot-wearing workers from the well pads, the McNamaras efficiently run the niche restaurant. They serve up between 35 to 40 tables a night and keep a staff of nine, including a head chef, Anthony Pipitone.

On a Thursday afternoon in August, the savory smell of sausage lasagna, stuffed zucchini and open-faced ravioli drifted through the quaint dining room, the chef on the other side preparing sauces while cook Betsy Groover eased pasta dough through a see montrose, paGe 30

anthony pipitone, the White oak’s head chef, uses only local produce to develop unique meals in the cozy farm-to-table restaurant.

Fueling Forward // 29

Bridget mcnamara, who runs her family’s restaurant, the White oak, said natural-gas production has not much affected business, but it has certainly changed the town where she grew up.

montrose from page 29 dough spreader. Susan’s husband renovated the restaurant with reclaimed wood and scrap tastefully restored to give the place a cozy, natural ambience.

WATER AND SEED Andre & Son celebrates 100 years next year selling turf products and services from its headquarters on the outskirts of town. Its. expertise in grooming grass-scapes from New York to Delaware, particularly in the golf industry, have found new purpose with pipeline companies, said store Manager David Spence.

“You just missed them. Just a few minutes ago we had a big order go out for Southwestern Energy,” Spence said.

After laying the pipelines, companies cover their tracks with grass seed, lime and fertilizer. Wherever they work, they like to put things back the way they were, Spence said.

While the lawn service keeps most of the family business’ 40-plus employees busy, they also run a hardware store where they sell fire-resistant work clothes and assorted tools.

Energy companies capitalized on the fact that the Andre family hardware store has connections with distributors.

Before, a few bottles of water once chilled in a fridge for some dusty contractor to grab one on the way out, now they order bottled water by the skid to deliver to well sites. Spence estimated they brought in more than 100 pallets of bottled water this summer.

INFRASTRUCTURE TOLL Like Bridget said, the roads in town were not built for the gas industry, and it shows.

Route 706 leaving town past Andre & Son is windy, congested and undergoing major reconstruction for about a mile.

The intersection at the center of town, overlooked by the Susquehanna County

Courthouse, is a bottleneck for idling water trucks and heavy equipment moving along Route 29 to get to the other side of town.

But just about everybody in Montrose has a happy farmer story and it seems they all agree gas

leases have helped farmers continue a life threatened by a bad economy. Every shop owner or employee could name one or two farmers who replaced outdated tractors and fixed up the family homestead with the help of royalty checks. n

©20

09 D oug

Kerr -

Wik iped

ia

30 // NEPA Energy Journal

BROADER

Horizons Reach your target audience by advertising in the NEPA Energy Journal CONTACT TRISH ROE AT 570-970-7361 | PROE@CIVITASMEDIA.COM

Fueling Forward // 31

Mt. Zion Material Handling Equipment Inc. 570-388-4001 • www.mtzionmh.com

We specialize in industrial products that offer cost effective solutions for your material handling needs. We are committed to providing quality products at competitive prices Mt. Zion is a family run and locally owned business.We have over 50 years of combined experience in our industry.We are located in Dallas PA and are able to serve your needs regardless of your location. Mt Zion Material Handling has been in business for over a decade and has served numerous businesses with their equipment needs.

CALL TO REQUEST A FREE MATERIAL HANDLING & STORAGE EQUIPMENT CATALOG

MT. ZION PRODUCTS

Loading Docks • Doors • Mezzanines & Offices Hoist & Crane • Storage Systems • Work Positioners Lift Assistants • Conveyer Systems

LOADING DOCKS

Exclusive local distributor of

Kelley Loading Dock Equipment Systems

Call For A Free Quote Today!

COMMERCIAL DOORS

We offer a wide variety of doors to meet your industrial needs from production areas, clean room applications, warehousing & loading dock areas.

Our doors are the most versatile in the industry.

Available in steel, aluminum, or stainless steel.

Built for superior operation and durability.