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Chamber eyes benefiting from Marcellus drilling

March 30, 2011

Larry McGuire/The Punxsutawney Spirit Jim Cassidy of the Pennsylvana Oil & Gas Association gave insight into the inner workings of the Marcellus Shale gas drilling industry through a Power Point presentation. This particular slide described the process of how horizontal drilling is used to extract natural gas located about a mile beneath the earth’s surface. (Photo by Larry McGuire)

PUNXSUTAWNEY — Those who attended the Marcellus Shale gas drilling presentation Wednesday at the IUP-Fairman Centre learned that there are numerous opportunities for business owners to service the gas well drilling industry.

Marlene Lellock, executive director of the Punxsutawney Area Chamber of Commerce, said the program was not about the pros and cons of Marcellus drilling, but how businesspeople and entrepreneurs can take advantage of the large natural gas formation located in the Jefferson County area and throughout Pennsylvania.

Jim Cassidy, of the Pennsylvania Independent Oil & Gas Association (PIOGA), noted that he had no oil and gas assets, and no ownership of companies involved with either shallow or Marcellus drilling.

Cassidy said the Marcellus field is old and covers about 95,000 square miles. Jefferson County — with only eight wells permitted in 2010 — is actually behind in drilling permits compared to other counties, such as Bradford (480 wells); Washington (306); Greene (189); Clearfield (63); Armstrong (49); and Indiana (20).

“Our eight wells look pretty puny compared to other counties,” he said, adding that it is more difficult to obtain a permit in Jefferson County because much of the acreage is already taken by shallow wells.

Cassidy said much of the land is owned by coal companies that made agreements with the gas companies and an easier take-away due to the close proximity of a major pipeline.

Pennsylvania has always had one of the largest natural gas reserves in the Marcellus region, which until now was not economically feasible for which to drill.

Cassidy said not until the new horizontal drilling techniques were the oil and gas companies able to access the gas, which rests a mile or more below the surface, with a thickness between 50 and 200 feet.

Cassidy said the fracking process involves 90 percent water, nine percent sand and a small amount of chemicals.

Existing businesses that can benefit from Marcellus drilling in Jefferson County include machine shops, water delivery trucks, construction of low cost housing, restaurants and RV rentals to house temporary workers.

“We’re fortunate to have the opportunity to service this industry while others won’t,” Cassidy said.

Chuck Allen, Penn State Cooperative Extension the College of Agricultural Sciences, said he, too, has no vested interest in oil and gas drilling.

Allen said the Marcellus drilling is an unconventional gas, and that the objective for the Chamber and other organizations is to keep as many dollars local.

The Barnett Shale located near Forth Worth, Texas, has just about run its course, which is why oil and gas companies are looking for new supplies. And that’s why they have come to the Northeast, where most of its customers are located.

“There is a large uncertainty because most of the projections come from the Barnett Shale region in Texas,” Allen said, adding that the industry is still so new here, that there’s no data available on the Marcellus formation.

A Marcellus well requires 420 employees to drill every well, which equates to 13 full-time jobs and 18 well tenders once the drilling rigs and others.

Lellock said the Marcellus Shale Task Force will look into holding a future presentation about the dangers to the environment and ground water from this type of drilling.

Cassidy said Pennsylvania has the advantage of learning about deep well drilling from other states like Texas, which has who’ve been involved in this type of drilling for a long time.

Chamber President Jeff Curtis said Punxsy is behind on cashing in on the Marcellus industry, and is playing catch up.

“We need to enhance this industry to help Punxsy as a whole,” he said.
Lellock said just recently, a drilling company that was looking to set up shop in town visited the Chamber, which was able to find a building for the company.

Lellock said the task force and Chamber is not sure what business opportunities there are out there.

“It’s new to us all and we’re looking to become a liaison for businesses and the well drilling industry,” she said.

The Chambers seeks to establish a Web site for area businesses to advertise their services for the drilling industry. Anyone interested in being listed on the Web site should call 938-7700.

“All we have to do is look and see how well Armstrong, Indiana, Bradford and Washington counties are benefitting from well drilling,” Cassidy said.

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