Editor’s Note: This is the fifth in a seven-part series on natural gas drilling gleaned from a recent staff outing to Pennsylvania. It will continue each Thursday in The Evening Sun.
SUSQUEHANNA COUNTY, Pa. – For the last two years, much of the U.S. has been experiencing unemployment levels in the double digits, but not Pennsylvania’s Northern Tier.
At a time when much of the country has been seeing jobs disappear, the northeastern corner of the Keystone State has bucked the trend. Bradford County, which neighbors Susquehanna County to the west, led Pennsylvania in job creation last year, with some 2,000 new jobs created between September 2009 and September 2010.
According to Anthony Ventello, executive director of the Progress Authority, the vast majority of those jobs can be attributed to the area’s booming natural gas industry.
“The Marcellus Play has changed our lives. It dominates all local conversations and agendas,” Ventello has stated in testimony before both House and Senate committees in the past year.
And he should know, as his agency has been instrumental in connecting the dots between natural gas related-companies and local businesses and communities in such a way that the region can reap the economic rewards of the booming industry.
The Progress Authority was established in 1993 by a group of area business people who felt regional economic development dollars weren’t being used in such a way to stymie the steady loss of manufacturing jobs. Ventello, who served as Bradford County’s planner for 12 years, was an obvious choice to lead the new agency, which was initially known as the Central Bradford Progress Authority. Today, the organization serves as the regional economic and industrial development authority for Bradford and Susquehanna Counties, and plays a key role in helping create jobs and facilitate investment in the region.
While Pennsylvania’s oil and gas industry dates back more than 150 years, it wasn’t until approximately three years ago that the Northeastern part of the state began to pique the interest of large multi-national energy companies. The object of their desire? The bountiful supply of natural gas buried deep beneath the earth’s surface in the Marcellus Shale play.
“When it became obvious it was going to be a real force, we decided we had to educate ourselves,” Ventello said. That was roughly two and a half years ago.
Part of the process was reaching out to leaders in Wise County, Texas, where development was already underway in the Barnett Shale play. One of the men Ventello connected with was Kevin Burns, a Wise County commissioner.
“He was able to articulate to us all the things we could anticipate,” the economic developer explained, including both benefits and concerns. According to Ventello, Burns’ advice was spot on.
“Everything that guy told us came true,” he said.
Ventello and a contingent from Bradford County - which included county level officials and representatives from the Conservation District and Pennsylvania State University Cooperative Extension - visited Wise County. For four days, they toured well sites, visited communities and talked with local people being impacted by the natural gas industry.
“We saw every aspect,” he said.
They also traveled to Calgary, Canada to attend the GO EXPO, North America’s largest oil and gas expo. The trip was encouraged by Pennsylvania’s Office of International Business Development and funded by a state Regional Investment Marketing (RIM) grant.
They brought what they learned on each of these excursions back with them and shared it with others.
“People just want information,” Ventello said.
Not only did these trips expose those involved to different aspects and impacts of the industry but, according to Ventello, they also helped them realize that the key is not only recognizing the similarities between other gas producing areas and the Northern Tier, but also understanding the differences.
Some of those differences are the abundance of water, which created a challenge for drillers in the spring when, after the thaw, back roads turned into pits of mud. Rural residents are also more dependent on ground water for drinking, he explained, rather than municipal water supplies, leading to greater fears of contamination.
In addition, land ownership is also much more fragmented and property owners own their own mineral rights. This isn’t true in all parts of the country, he said, nor in Canada, where mineral rights are property of the Crown.
According to Ventello, there are two ways in which local communities can make money from the natural gas industry. One is through land owner payments, such as lease and royalty payments. The other is business to business.
“It’s been unbelievable,” he said, referring to the impact of companies relocating to the region and the expansion of other businesses made possible by their investment in the area.
Some of those connections have been made as a result of the Marcellus Shale Business to Business Expo held in June. Ventello chaired the planning committee for the event, which attracted 255 exhibitors. Companies large and small were involved, from large industry players like Chesapeake Energy, Talisman Energy and Chief Oil & Gas to local banks, insurance and real estate brokers, engineering firms, tourism properties, recreation, car dealerships and medical providers.
According to Ventello, the expo was such a success that a second is being planned for 2011.