Ohio Gas & Oil October 2020

October 2020

A Free Monthly Publication

A RECORD-SETTING AUGUST FOR NATURAL GAS IN THIS ISSUE: BIPARTISAN SUPPORT FOR INCREASING NATURAL GAS USAGE IN UNITED STATES

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NEWS. BUSINESS. TECHNOLOGY. ALLIANCE Bill Albrecht 330.669.3782

CAMBRIDGE Heather Kritter 614.583.5793

OHIO’S GAS & OIL INDUSTRY RAVENNA Elie Stephan 330.996.3093

WOOSTER Aaron Bass 330.264.1125

CALL YOUR LOCAL OHIO GAS & OIL SALES REP. TODAY

Table of Contents OCTOBER 2020 G ROUP PUBLISHER

2

A Look Ahead Gas & Oil Events

3

This Summer Was Monumental For Natural Gas, Ending With Record-Setting August

5

Columbus to Pittsburgh Corridor Featured in U.S. Department of Energy Report

6

Find Happiness in the Chaos - Guest Editorial

8

New OOGEEP Director Shares Program Updates

Bill Albrecht

EXECUTIVE EDITOR Beth Bailey bbailey@daily-jeff.com

10

Poll Shows Bipartisan Support for Increasing Natural Gas Usage in United States

11

Fossil Fuels Account for the Largest Share of U.S. Energy Production and Consumption

13

Report: Energy Infrastructure is Essential to Jumpstarting American Economy

15

Ohio Well Activity

16

Horizontal Drilling Activity Graph

On The Cover:

This summer, Americans received power by means of natural gas in record-breaking numbers. According to estimates from S&P Global Platts, electricity generated by natural gas reached a daily record high of 47.2 billion cubic feet as of July 27, 2020.

OCTOBER 2020

OCTOBER 2020 ADVER TISING Elie Stephan Akron & Kent, Ohio Offices estephan@localiq.com 330-996-3093 Bill Albrecht Alliance & Minerva, Ohio Offices balbrecht@localiq.com 330-669-3782 Aaron Bass Ashland, Ohio Office abass@localiq.com 419-281-0581 Heather Kritter Cambridge, Ohio Office hkritter@localiq.com 614-583-5793 Aaron Bass Wooster & Holmes County, Ohio Offices abass@localiq.com 330-264-1125

L AYOUT DESIG NER Phil Luks

pluks@recordpub.com

212 E. Liberty St. Wooster, OH 44691 330-264-1125 “Ohio Gas & Oil” is a monthly publication. © GANNETT Co. Inc. 2020

OhioGas&Oil

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A Look Ahead

Gas & Oil Events

– Ohio Certified Fire Instructor – Adjunct Instructor Ohio Fire Academy – Board of Directors, Ohio Fire Chiefs’ Association – President, Southeast Fire Chiefs’ Association OOGEEP RESPONDING TO OIL– More than 40 years experience in FIELD EMERGENCIES TRAINING emergency response and fire eduINSTRUCTORS cation Lead Fire Instructor: Other Instructors: Chief Brent Gates, New Concord Includes a team of 15+ state certiFire Department fied fire instructors, emergency reDUE TO THE COVID-19 PANDEMIC, MANY EVENTS HAVE BEEN CANCELED OR POSTPONED. PLEASE CHECK WITH THE EVENT COORDINATOR(S) FOR NEW DATES AND TIMES.

OCTOBER 3-4, 2020

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sponders and industry experts with more than 500 years of combined experience in the oil and gas industry and/ or fire service.

TRAINING LOCATION Wayne County Fire & Rescue Regional Training Facility 2311 South Millborne Road, Apple Creek, OH 44606 www.oogeep.org

OCTOBER 2020

THIS SUMMER WAS MONUMENTAL FOR NATURAL GAS,

Ending With Record-Setting August DYLAN LACROIX | U.S. Energy Information Administration This summer, Americans received power by means of natural gas in record-breaking numbers. According to estimates from S&P Global Platts, electricity generated by natural gas reached a daily record high of 47.2 billion cubic feet as of July 27, 2020. That same day, natural gas-fired electricity in the lower 48 reached an all-time high of 316 gigawatts (GW).

As the United States continues to grapple with the effects of the COVID-19 pandemic, one thing is clear: natural gas provides affordable energy security to millions of Americans—and this summer’s record demand proves just that.

Daily Record Natural Gas Burn in July July’s record-setting natural gas burn did not come as a surprise, either. Just a year prior, the United States set a similar record of 45.4 bcf on August 6, 2019.

According to U.S. Energy Information Administration reporting, the rise in power burn was associated with lower national prices for natural gas and expanded use of natural gas-fired capacity. Or, in other words, natural gas has proven itself to be an affordable, reliable and resilient option for powering American homes and businesses.

individuals and people of color—the same demographics positioned to benefit the most from increased natural gas-fired electricity.

Meeting Energy Demands When looking at the portfolio of energy production in the contiguous United States, electricity generated by natural gas made up the largest share of all energy sources on July 27, 2020, roughly 45 percent. Second to natural gas, coal made up almost a quarter of U.S. energy sources at 24 percent, with nuclear and renewable energy at 17 and 12 percent, respectively.

Activation of natural gas as an energy source is a key competitive advantage when compared to other sources of energy. As stated in the EIA’s most recent Record continued on page 4

OCTOBER 2020

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Natural gas is also becoming a vital component to alleviating financial strains for low-income households during the COVID-19 pandemic. A recent survey by Indiana University found that higher energy costs are disproportionately affecting low-income

OhioGas&Oil

3

Record continued from page 3

report, natural gas underwrites U.S. capability to meet peak energy demands:

“Natural gas is a key power generation resource because it has the flexibility to supply electricity at any time, including at times of peak demand.

In contrast, some renewable energy technologies and nuclear power plants may be nondispatchable and not able to adjust their generation to meet load.”

Natural Gas Prices Rally Prices of natural gas are soaring right along with demand. As more and more natural gas is utilized to create electricity, inventories across the United States are dwindling, creating sharp increases in prices for the month of August.

According to Barron’s, futures contracts for natural gas on August 31, 2020 soared to $2.63 million British thermal units, a 46 percent increase for the month. This increase nearly touched a record set in September 2009, when prices skyrocketed 62.6 percent.

Conclusion In all aspects, the data shows that in order to reduce energy costs for millions of U.S. residents and provide stable energy security during peak demand seasons, natural gas must continue to be at the forefront of the U.S. energy development strategy. As this summer shows, natural gas is reliable, affordable, and the best option for powering U.S. homes and industries.

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COLUMBUS TO PITTSBURGH CORRIDOR Featured in U.S. Department of Energy Report this Summer The Columbus Pittsburgh Corridor Association

The Columbus Pittsburgh Corridor Association is pleased to announce the federal acknowledgement and support of the Columbus to Pittsburgh Corridor Project; as it was featured in the U.S. Department of Energy’s June 2020 edition of The Appalachian Energy and Petrochemical Renaissance.

The Columbus to Pittsburgh Corridor is listed as a project that would “support economic growth and diversification” within the Appalachian Region, when completed.

“We certainly are encouraged by this acknowledgement and the potential for support from the federal government,” said Ed Looman, CPCA President. “The association continues to push for action on this much needed transportation alternative.

Going forward, our hope is we can have another feasibility study on the proposed corridor.”

The project can further assist in providing an economic boom to the Eastern region of the state; as shale oil/gas, steel, petrochemical, manufacturing, logistics, food processing, and tourism are all industries on the rise along the corridor. With only 30% of the 160-mile corridor to be completed, the endorsement of the project from the U.S. Department of Energy will prove to be an invaluable asset in the finalization process. The completion of the Columbus to Pittsburgh Corridor will not only have a positive impact on Eastern Ohio; but will also bolster economic growth in neighboring West Virginia and Pennsylvania counties.

“To be in an Executive Order Report signed off by the White House is a very encouraging step.

While how the project will get funding is still a primary effort and will take time. We remain focused on continuing to push for completion of this viable roadway artery for the future of our region and the new global diversified business economy we are

OCTOBER 2020

building and trying to attract,” Nick Homrighausen, Executive Director of Harrison County Community and Economic Development and CPCA Vice Chair stated, “The efforts of our trip to Washington D.C. last year and our meetings with DOE, Congress & Senate can only of certainly helped in this reports inclusion. With less than 30% of the roadway to be completed to 4-lanes we continue to remain positive and will push our efforts to the next level as the time is now to complete what was started well over 40 years ago.”

“Completion of this four-lane corridor is vital to the economic growth and resiliency of the OMEGA region and will promote growth in the wood products, food processing, logistics, and other diverse manufacturing sectors,” Ohio Mid-Eastern Governments Association (OMEGA) Executive Director Jeannette Wierzbicki said, “As referenced in DOE’s report, investment in this project is also a crucial component of the Appalachian energy and petrochemical renaissance. The Columbus to Pittsburgh corridor will also alleviate congestion on I-70 and lead to more efficient movement of freight between the two growing metropolitan areas”.

The Columbus Pittsburgh Corridor Association is excited for the future of this project and looks forward to partnering with local, state, and federal entities to ensure success for the region!

OhioGas&Oil

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Find Happiness in the Chaos Guest Editorial

GREG KOZERA | Shale Crescent USA Because of COVID-19, I gave a lot of thought to coaching high school soccer again. There are potential risks and exposure to the virus. Every day is full of risks.

Just getting out of bed and going downstairs is a risk. Driving a car is a risk. We always need to take precautions like wearing a seat belt or a mask. The alternative is to stay in bed. I’m coaching! This will be a challenging season because of the uncertainties with COVID-19 and related rules. We can’t even guarantee we will play a game until it starts. This season will require mental toughness as well as the usual hard work, skills and teamwork. As a coach, hopefully I can help the boys to develop mental toughness.

One of the reasons I coach is the joy of helping boys grow into young men and learn to achieve their dreams. I remember the joy of watching the boys hoist our first state championship trophy. Tanner, was our goalkeeper. He was so short he had to a hard time touching the crossbar even when he jumped. Tanner’s heart, hard work and attitude made up for his lack of size. He won the starting goalkeepers job just before the playoffs started. When the championship game ended the paper took a picture of Tanner with both feet off the ground. We met on the field with tears of joy in our eyes. I told him, “You are a State Champion Keeper.” He went on to be a successful Army officer and attorney.

A few years ago, Lynnda and I were at the National Speakers Association (NSA) Convention in Phoenix, Arizona. We were at the airport rental car facility. I gave my paperwork to the young man who would bring our rental car to us. He asked why we were in Phoenix. I told him we were there for a professional speakers’ conference. He excitedly responded, “I have always wanted to do that. Can you tell me one thing that will help me?” Then he dashed off to get our car.

No one had ever asked me that question. I had to think about it. By the time he returned with the car I told him, “Remember this, It’s not about you or your message, it’s all about the audience.” In my career when I took the focus off me or my organization’s needs and focused on the audience’s needs and concerns everything changed in a very positive way.

Success in business and sales, as a manager or

owner happens when we put our customers’ needs ahead of ours. If we give our customers what they need and want first, we have a chance to get what we need. The late sales expert Zig Ziegler said, “You can have anything you want if you first help enough other people get what they want.” At Shale Crescent USA, our prospects have access to our hard data so a decision to come to our Region is easier. Local companies can use it to expand creating jobs our Region needs.

“Hell is having and doing everything we want and realizing it doesn’t make us happy.”

We have a large network we can access, three studies we can give away for free and years of experience to help companies expand in our Region.

Everyone is searching for happiness. As a child, I learned happiness isn’t about having stuff. Growing up I had 5 brothers. Our Dad worked for the government. We didn’t have a lot of “things” but we had our family and friends. We were happy. I believe it was because my parents kept us focused on what we had instead of what we didn’t. We complained because we only got one gift for Christmas. The only child down the street got more presents than all of us. My mother said, “There are six of you. You can play with Happiness continued on page 7

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OCTOBER 2020

Happiness continued from page 6

each other. That is like having 6 toys.” Mom was right.

The boy down the street was lonely. He never wanted us to go when we visited.

Happiness isn’t about acquiring things. I notice when I am happy other people are involved. A preacher recently suggested a different picture of hell. It wasn’t fire and brimstone. He said, “Hell is having and doing everything we want and realizing it doesn’t make us happy.” Happiness from stuff doesn’t last very long.

What does our happiness have to do with focusing on the needs of others rather than our own and making a difference? I believe, a lot.

The late Earl Nightingale said, “Happiness is an inside job”. We get to decide how happy we are based not on what happens to us but how we choose to look at it. For some people, the lock down was a big negative. For others, it was a time of opportunity to work on their business and grow closer to family. When I focus on helping others I find happiness.

When I began coaching high school soccer, it wasn’t about money. We didn’t get paid. It was about giving back to the school that gave my kids a great education. I did not expect the amount of joy and happiness I received. The boys helped me to dream again.

A gift important in the work I do for Shale Crescent USA.

What in your life gives you joy, especially now?

Start with your spouse and family. What can you do to make them happy? In my marriage, I learned if I expected to be happy I needed to help Lynnda to be happy. What can you do to make the world a better place? One person can make a difference. Give your time, talent and money without expecting anything in return.

In these chaotic times people need joy and encouragement. They need to know people care about them. If we expect to be happy we need to first give joy and happiness to others. We all have the power to make a positive difference in the lives of others.

Do it now! © 2020 Shale Crescent USA Greg Kozera, gkozera@shalecrescentusa.com is the Director of Marketing and Sales for Shale Crescent USA. He is a professional engineer with a Masters in Environmental Engineering who has over 40 years’ experience in the energy industry. Greg is a leadership expert and the author of four books and numerous published articles.

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New OOGEEP Director Shares Program Updates KRISTI R. GARABRANDT | The Daily Jeffersonian USA TODAY NETWORK John Schlichter, new executive director of the OO“It really shaped my life being part of a small comGEEP (Ohio Oil and Gas Energy Education Program), munity and being part of the agricultural community, recently shared his background too,” Schlichter said. “So, going on and OOGEEP updates during a to be a state rep and working with Coffee and Commerce Zoom meetnatural resources I ended up on the ing hosted by the Cambridge Area finance community. I had a lot of opChamber of Commerce. portunity there to try to make a difSchlichter first shared that his ofference. I lead the charge in bringing fice is the OOGEEP office whose Ohio in compliance with No Child mission is to educate Ohioans on Left Behind.” the natural gas and oil industry Schlichter said that was one of the is located in Granville. He also notfirst things handed to him when he ed that eastern Ohio is really fortugot to the legislature and he is very nate to have a lot of planning and proud of that accomplishment. education going on.

After leaving the legislature, he Schlichter is originally a farmwent back into agriculture working er from Fayette County. He rented with a non-GMO soybean company and operated a farm in the county working with exports. just north of Washington CourtIn 2012, he went to the Department house until 2006 when it was shut of Agriculture as deputy director.

John Schlichter down after the passing of the propIn July, he was named executive dierty owner. He farmed for over 30 rector at OOGEEP. Executive Director Ohio Oil and Gas years.

“I really enjoy being here as part Energy Education Program In addition to farming, Schlichter of this group. We have a great held an interest in politics. He began his political ca- staff,” Schlichter said. “I really just enjoy the folks. They reer as a treasurer on the school board after realiz- are great people and they really care for the industry ing he needed to be more involved in the community. and that is what I have that has really been important He served on the school board for four years then went to this.” on to serve on a joint tri-county board of education beSchlichter noted that OOGEEP is a nonprofit statefore running for Fayette County commissioner, a term wide education program and public outreach program. he held for four years.

“That is what our main focus is,” Schlichter said. “We “I love being a county commissioner. You are at that do a lot of teacher trainings. We do a lot of firefightlevel where you know everybody,” Schlichter said. “You er trainings. We hand out the oil and gas flyers. We know everything that goes on in the county as far as do geology workshops. We do STEM workshops with development. We did a lot of work with the chamber teachers. So we are all about education and all about of commerce and I grew to appreciate the work that trying to show the communities and the State of Ohio they do.” not just Eastern Ohio, we try to show the whole state In 2002, he campaigned for the state representative as to what the oil and gas industry means to their daily seat for the 85th House District which encompassed lives.” all of Fayette County and parts of Ross and Pickaway Schlichter said he believes that with the U.S. being counties. the number one oil producer and number one gas proHe held that position for six years. He ran again in ducer that education is important. He also noted that 2008 and lost.

Ohio is currently fifth in production in the U.S. Schlichter said that during his time in politics he did “The oil and gas industry employs over 200,000 peoa lot of agriculture work and used his background in ple in Ohio so it’s something that is extremely imporeducation to do some education work. tant that we spread that message and get that word Schlichter and his wife have three grown children out,” Schlichter said. If you look at some of the teacher and a grandson. workshops that we have done since we started in 1998, Update continued on page 9

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OCTOBER 2020

Update continued from page 8

we have put 3,103 teachers through our workshop.”

According to Schlichter, when the teachers come to the workshop they are asked how many students they will impact this year and on average it’s about 100 students each teacher impacts in a year.

“So with 3,000 teachers, that a lot of kids that we have impacted,” Schlichter said. “We can probably say that through our programs, teachers have touched millions of kids. So, that is something we are very proud of.”

The firefighter training started in 1999 and since that time they have trained over 1,693 firefighters in 687 departments in 60 of Ohio’s counties, according to Schlichter.

“The outreach of education we have been super strong here and we have been able to continue that outreach and hope to continue this year,” Schlichter said. “We have done two online and we have done a webinar. We have also done an in-person program on geology this summer. There were fewer people involved in our geology this summer because we tried social distancing.”

OOGEEP has given out 531 scholarships to 328 students to help them get their start in the oil and gas industry.

For science fairs, there have been 296 state science fair awards for 261 students from 154 schools in 54

Ohio counties, according to Schlichter.

Schlichter said that his office is trying to that number to include all Ohio counties. OOGEEP is making an effort to push toward the western and southwestern parts of the state.

OOGEEP has recently started working on the largest public awareness campaign they have ever done, according to Schlichter. It has already started on social media sites and internet ads. They have plans for the beginning of September to start commercials on network and cable TV. “We are super proud of the things we have done as far as educating so far,” Schlichter said. “But that is not where we stop. As we move forward, I just have to say that it is so important for us to work with the folks that we are partners and try to get the word out and try to have them help us get the word out. It’s not about highlighting OOGEEP, it’s about highlighting the hard work that the men and women in our industry do every day. They deliver essential energy to Ohio.”

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POLL SHOWS BIPARTISAN SUPPORT

for Increasing Natural Gas Usage in United States WILLIAM ALLISON | EnergyInDepth There is broad, bipartisan support for natural gas heading into the 2020 election with 55 percent of respondents in favor of “increasing the use of” the fuel, according to anew poll from the Brunswick Group.

It’s the third poll is as many months underscoring the public’s backing of natural gas as a vital fuel for both energy reliability, economic security, and addressing climate change.

The standout finding from the Brunswick poll is that both Democrats and Republicans support natural gas. For 2020 general election Democrats, 44 percent have positive impressions of natural gas while 52 percent of 2019 primary Democrats share similar feelings. Among Republicans, there is strong

support with 76 percent having positive impressions.

Respondents from both parties also feel that natural gas plays a “vital role” in addressing climate change including 68 percent of Democrats and 88 percent of Republicans.

Also notable was the low intensity of negative feelings with only 16 percent opposing the increased use of natural gas for a net positive rate of 39 percent. And only 24 percent of 2020 Democrats have a negative impression of natural gas for a net positive rate of 20 percent.

Brunswick noted the one caveat is that voters believe the industry can do a better job of reducing emissions. To that end, improvements in technology and increased innovation have yielded positive results for the industry over the past decade as the

10 OhioGas&Oil

shale revolution took off.

In April, the Environmental Protection Agency released its 2020 Greenhouse Gas Inventory that showed, thanks to industry efforts, methane emissions from U.S. oil and natural gas has fallen 23 percent from their 1990s levels even as oil and natural gas production increased by 49 percent and 72 percent, respectively.

A separate report from the Energy Information Administration found that energy-related CO2 emissions decline by nearly 3 percent from 2018 to 2019 even as the economy grew by 2.3 percent. This reduction was driven by natural gas becoming the fastest growing energy source. Natural gas is also the reason the United States has become by far and away, the global leader in reducing emissions since 2005. Furthermore, the top five emissions reducing states are all big natural gas consumers.

The findings from the Brunswick Group are not an outlier either.

A poll in June published by the American Gas Association and conducted by Morning Consult – an independent media firm – found that Millennial and Gen Z voters support natural gas. More than 60 percent of respondents felt that natural gas was affordable, reliable, and accessible.

Another poll conducted by Morning Consult in August along with the American Petroleum Institute found that 64 percent of respondents in a selection of key swing states are more likely to vote for a candidate who “supports policies that ensure consumers continue to have access to natural gas and oil produced in the U.S.” Another 75 percent said that they agree that oil and natural gas are “essential to a modern lifestyle, and 63 percent said that natural gas will play an important role in in helping the economy bounce back from the COVID-19 pandemic.

As each of these polls demonstrate, energy security and affordability are not partisan issues – and natural gas has a significant role to play for both.

OCTOBER 2020

FOSSIL FUELS ACCOUNT FOR THE LARGEST SHARE OF

U.S. ENERGY PRODUCTION AND CONSUMPTION | U.S. Energy Information Administration

Source: U.S. Energy Information Administration, Monthly Energy Review

Fossil fuels, or energy sources formed in the Earth’s crust from decayed organic material, including petroleum, natural gas, and coal, continue to account for the largest share of energy production and consumption in the United States. In 2019, 80% of domestic energy production was from fossil fuels, and 80% of domestic energy consumption originated from fossil fuels.

The U.S. Energy Information Administration (EIA) publishes the U.S. total energy flow diagram to visualize U.S. energy from primary energy supply (production and imports) to disposition (consumption, exports, and net stock additions). In this diagram, losses that take place when primary energy sources are converted into electricity are allocated proportionally to the enduse sectors. The result is a visualization that associates the primary energy consumed to generate electricity with the end-use sectors of the retail electricity sales customers, even though the amount of electric energy end users directly consumed was significantly less.

The share of U.S. total energy production from fossil

Source: U.S. Energy Information Administration, Monthly Energy Review

fuels peaked in 1966 at 93%. Total fossil fuel production has continued to rise, but production has also risen for non-fossil fuel sources such as nuclear power and renewables. As a result, fossil fuels have accounted for about 80% of U.S. energy production in the past decade.

Fossil continued on page 12

OCTOBER 2020

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Fossil continued from page 11

Since 2008, U.S. production of crude oil, dry natural gas, and natural gas plant liquids (NGPL) has increased by 15 quadrillion British thermal units (quads), 14 quads, and 4 quads, respectively. These increases have more than offset decreasing coal production, which has fallen 10 quads since its peak in 2008.

U.S. primary energy overview and net imports share of consumption (1950–2019) Chart net Title quadrillion British thermal units imports share of consumption (percent) 35%

120

consumption

100

30%

60

15%

40

imports

10%

exports

0 1950

1970

1990

2010

40

petroleum

35

70% 60%

45

coal 30 natural gas

natural gas

25

50%

20

40%

15

30%

1970

coal renewables nuclear

10

petroleum

fossil fuels

1990

2010

5 0 1950

1970

1990

2010

Source: U.S. Energy Information Administration, Monthly Energy Review

0% -5% 1950

80%

0% 1950

5% 20

nuclear renewables

90%

10%

20%

production

100%

20%

25% 80

U.S. primary energy consumption by source (1950–2019) Chart Title Chart Title total share (percent) quadrillion British thermal units

1970

1990

2010

Source: U.S. Energy Information Administration, Monthly Energy Review

In 2019, U.S. energy production exceeded energy consumption for the first time since 1957, and U.S. energy exports exceeded energy imports for the first time since 1952. U.S. energy net imports as a share of consumption peaked in 2005 at 30%. Although energy net imports fell below zero in 2019, many regions of the United States still import significant amounts of energy.

Most U.S. energy trade is from petroleum (crude oil and petroleum products), which accounted for 69% of energy exports and 86% of energy imports in 2019.

Much of the imported crude oil is processed by U.S. refineries and is then exported as petroleum products.

Petroleum products accounted for 42% of total U.S. energy exports in 2019.

The share of U.S. total energy consumption that originated from fossil fuels has fallen from its peak of 94% in 1966 to 80% in 2019. The total amount of fossil fuels consumed in the United States has also fallen from its peak of 86 quads in 2007. Since then, coal consumption has decreased by 11 quads. In 2019, renewable energy consumption in the United States surpassed coal consumption for the first time. The decrease in coal consumption, along with a 3-quad decrease in petroleum consumption, more than offset an 8-quad increase in natural gas consumption.

EIA previously published articles explaining the energy flows of petroleum, natural gas, coal, and electricity. More information about total energy consumption, production, trade, and emissions is available in EIA’s Monthly Energy Review.

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OCTOBER 2020

REPORT:

ENERGY INFRASTRUCTURE IS ESSENTIAL TO JUMPSTARTING AMERICAN ECONOMY DYLAN LACROIX | EnergyInDepth Billions of dollars in economic activity are being held back from jumpstarting the economy, according to a telling report from Consumer Energy Alliance released this week. A number of pipeline expansion and energy infrastructure projects spanning from Appalachia to Montana have experienced cancellations, delays, or obstructions—all of which comes at a cost for the communities and economies they support.

The report titled, “How Pipelines Can Spur Immediate Post-COVID Economic Recovery,” measures the toll of these cancellations and delays against the positive outcomes these projects would have on spurring job creation and tax revenues. What CEA found was devastating: More than 66,000 energy jobs and $280

million a year in state andlocal tax revenue, could be in jeopardy should these projects continue to face challenges. As the report explains: “The real impacts on workforce participation are expected to be historically bad with more than 103 million Americans, or nearly 40 percent of the country, at least temporarily out of the labor force – a low not seen since January 1973. And the public sector ripple effect from the lost revenues due to the COVID-19 shutdown is starting to be felt: States and municipalities are furloughing staff now and cutting essential services on which the public relies.”

Report continued on page 14

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Report continued from page 13

Attacks on Industry

On top of what the COVID-19 pandemic has brought upon the industry, CEA acknowledges there are multiple, strongly organized efforts to dismantle the industry andquash these projects. Moreover, these types of concerted efforts are becoming more confrontational, and failing to acknowledge any progress made on behalf of the industry in terms of environmental sustainability and economic value.

In its report, CEA outlines specifically how lawsuits, regulations, and procedural challenges are placing billions in economic activity in limbo—leaving communities and local economies that desperately need it, behind: “Activists, litigation and permit delays have canceled or are threatening a minimum of $13.6 billion in economic activity, the creation and support of over 66,000 jobs and more than $280 million per year in state and local tax revenue just by targeting the pipeline projects in this report. Further, untold billions in cumulative consumer savings are being put at risk or have been permanently lost during an economic downturn simply because certain policymakers, regulators and even jurists will not approve pipelines.”

supply chain: including steel, parts, and a number of services. As the report explains: “The COVID-19 outbreak has laid bare great weaknesses in our supply chains, including our over-dependence on China and global competitors for key components. That has not only been demonstrated in our consumer and medical goods supply chains, but in the energy sector for solar development, battery storage and demand.”

Conclusion Based on CEA’s findings, it is safe to say that the U.S. economy needs a jumpstart and that energy infrastructure is a key part of making that happen.

With tens-of-thousands of well-paying jobs at stake, and billions of dollars on the line to support essential state and local services, it’s time to remove the barriers to a more secure economy and future for the energy industry.

Economic Impact U.S. residents who have come to increasingly rely on affordable energy due to the COVID-19 pandemic, are now also in jeopardy of rising energy costs and less opportunities for jobs.

According to the report, jobs in the oil and natural gas industry are among the highest in median wages across U.S. salaried workers at an average of $117,000.

The COVID-19 pandemic has also caused havoc to other manufacturing industries that rely on oil and natural gas too. Pipeline construction creates and spurs demand for a number of industries within the

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OHIO WELL ACTIVITY by the numbers

UTICA SHALE

MARCELLUS SHALE 24 8 5 40

77

494 101 105

Wells Permitted Wells Drilling Wells Drilled Not Drilled Wells Producing Inactive Other Total Horizontal Permits

Data as of 9/12/20

2593

3293

Wells Permitted Wells Drilling Wells Drilled Not Drilled Wells Producing Inactive Plugged Total Horizontal Permits

Source: Ohio Department of Natural Resources

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TOP COUNTIES WITH HORIZONTAL DRILLING ACTIVITY

BY NUMBER OF SITES

1. Belmont County........ 705 2. Harrison County....... 532 3. Carroll County..........531 4. Monroe County........ 507 5. Jefferson County...... 289 6. Guernsey County...... 280.

7. Noble County.......... 230 8. Columbiana County...163 9. Mahoning County....... 29 10. Washington County... 21 11. Tuscarawas County.... 20 12. Portage County........ 15 Trumbull County........ 15 13. Stark County............ 12 14. Coshocton County....... 5 15. Muskingum County...... 4 16. Holmes County........... 3 17. Morgan County........... 2 Knox County.............. 2 18. Ashland County.......... 1 Astabula County......... 1 Geauga County.......... 1 Medina County........... 1 Wayne County............ 1

WELL SITES IN VARIOUS STAGES: PERMITTED DRILLING, DRILLED, COMPLETED, PRODUCING, PLUGGED, , D SI S SOURCE: OHIO DEPARTMENT OF NATURAL RESOURCES AS OF 9/12/20 PLETED PRODUCING PLUGGED

D

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L

25

125

225

325

425

525

625

725

A

OCTOBER 2020

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The U.S. Energy Information Administration collects, analyzes, and disseminates independent and impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment. www.eia.gov

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