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Ohio Utica Shale

Pittsburgh-area site chosen for major refinery

By admin Published: March 15, 2012

PITTSBURGH: Shell Oil Co. has chosen a site near Pittsburgh for a major, multibillion-dollar petrochemical refinery that could provide a huge economic boost to the region.

Dan Carlson, Shell’s General Manager of New Business Development, said Thursday that the company signed a land option agreement with Horsehead Corp. to evaluate a site near Monaca, about 35 miles northwest of Pittsburgh.

Ohio, West Virginia and Pennsylvania had all sought the plant and offered Shell major tax incentives. Monaca is just 20 miles from both the Ohio and West Virginia borders, so workers in all three states are likely to benefit.

Shell has said that it could spend several billion dollars to build the plant, and that the complex would attract a wide range of industry and suppliers to nearby locations. But actual construction is still years away. The company said the next steps are environmental and design studies and further economic analysis, then permits.

One lifelong resident of the Pennsylvania township almost broke down on hearing the news.

“Oh my God. It makes me want to cry. That’s just the best news,” said Christie Floyd-Gabel, Potter Township’s secretary.

It’s also an unexpected turn for Horsehead’s zinc factory, which is located on the banks of the Ohio River. In September the company announced plans to shut the Monaca smelter plant by 2013 and relocate to North Carolina, along with most of its 600 workers.

“That was a major loss,” Floyd-Gabel said of Horsehead’s plans to depart, adding that’s it’s amazing that another major corporation may come in to replace Horsehead.

Ali Alavi, a Horsehead spokesman, said the company would have to vacate the factory site by April 30, 2014, under the terms of the option agreement with Shell.

Shell said the Horsehead site had the mix of resource and transportation attributes “to accommodate facilities for a world scale petrochemical complex and potential future expansions.”

The so-called ethylene cracker plant would convert natural gas liquids into other, more profitable chemicals, which then go into everything from plastics to tires to antifreeze.

Shell’s choice may ultimately represent an indication of just how strongly the industry feels about the vast gas reserves in nearby underground shale rock formations. Carlson told the Associated Press that any plant must be economically competitive with existing plants in Louisiana and Texas, and even with international plants.

The Marcellus Shale, which lies thousands of feet underground, has attracted a rush of major oil companies, who have drilled almost 5,000 new wells in the last five years. The Marcellus covers large parts of Pennsylvania, New York, Ohio and West Virginia, and drillers have also started to tap the adjacent, deeper Utica Shale formation.

Ohio and West Virginia officials had made all-out efforts to attract the plant. Last year West Virginia Commerce Secretary Keith Burdette said, “We intend to compete with the last breath in our body to attract one or more crackers,” and Ohio Gov. John Kasich reportedly flew to Houston to meet with Shell officials.

The Monaca site is several miles away from another industrial park in Aliquippa that state and local officials had touted.

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Utica and Marcellus shale web sites

Ohio Department of Natural Resources' Division of Oil and Gas Resources Management State agency Web site.

ODNR Division of Oil and Gas Resources Management. State drilling permits. List is updated weekly.

ODNR Division of Geological Survey.

Ohio Environmental Protection Agency.

Ohio State University Extension.

Ohio Farm Bureau.

Ohio Oil and Gas Association, a Granville-based group that represents 1,500 Ohio energy-related companies.

Ohio Oil & Gas Energy Education Program.

Energy In Depth, a trade group.

Marcellus and Utica Shale Resource Center by Ohio law firm Bricker & Eckler.

Utica Shale, a compilation of Utica shale activities.

Landman Report Card, a site that looks at companies involved in gas and oil leases.FracFocus, a compilation of chemicals used in fracking individual wells as reported voluntarily by some drillers.

Chesapeake Energy Corp,the Oklahoma-based firm is the No. 1 driller in Ohio.

Rig Count Interactive Map by Baker Hughes, an energy services company.

Shale Sheet Fracking, a Youngstown Vindicator blog.

National Geographic's The Great Shale Rush.

The Ohio Environmental Council, a statewide eco-group based in Columbus.

Buckeye Forest Council.

Earthjustice, a national eco-group.

Stop Fracking Ohio.

People's Oil and Gas Collaborative-Ohio, a grass-roots group in Northeast Ohio.

Concerned Citizens of Medina County, a grass-roots group.

No Frack Ohio, a Columbus-based grass-roots group.

Fracking: Gas Drilling's Environmental Threat by ProPublica, an online journalism site.

Penn State Marcellus Center.

Pipeline, blog from Pittsburgh Post-Gazette on Marcellus shale drilling.

Allegheny Front, environmental public radio for Western Pennsylvania.