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Ohio Utica Shale

Utica shale to generate 143,000 Ohio jobs, $18 billion to economy by 2020

By Bob Downing Published: December 19, 2012

A new study indicates that Utica shale development now supports 38,380 jobs in Ohio and that total is expected to grow to 143,000 by 2020 and to 266,000 by 2035.

That analysis came today from IHS Inc., a leading global energy research group.

The study was co-sponsored by the U.S. Chamber of Commerce’s Institute for 21st Century Energy and other partners: the American Petroleum Institute, the American Chemistry Council, America’s Natural Gas Alliance and the Natural Gas Supply Association.

In addition, Ohio drilling in 2012 added $4.1 billion to the state’s economy, the report says. That total is projected to reach $18 billion by 2020, the report says.

Drilling also produced $911 million in 2012 in state and local tax revenue in Ohio, a total that could climb to $4.6 billion by 2020, it says.

"Shale energy is a game-changer for America and for Ohio," said Karen Harbert, president and CEO of the energy institute.

"The latest installment of this study allows us to quantify just how significant the impact on Ohio’s economy will be," she said in a statement. "It provides all the more reason to strongly support responsible shale energy development."

Added Linda Woggon, executive vice president of the Ohio Chamber of Commerce and executive director of the Ohio Shale Coalition: "Ohio is already seeing a significant boost to our economy from shale energy, and this study shows that much more is to come."

At present, Ohio has 477 wells permitted in the still-developing Utica shale in eastern Ohio. To date, 196 wells have been completed, of which 45 wells are in production. Pipelines and processing facilities must be built before Ohio wells come be fully developed.

The industry expects to have more than 2,000 Utica wells in Ohio by 2015.

The new report is the second of three parts looking at the economic impacts of shale drilling on a state-by-state basis. The first report looking at national benefits was released in October.

The final report, expected in early 2013, will look at moving and processing natural gas, oil and natural gas liquids, and the use of those materials by chemical companies and manufacturers.

Nationally, the IHS study shows that shale drilling is supporting 1.2 million jobs at the moment. It will be responsible for 2.5 million jobs by 2015; 3 million by 2020 and 3.5 million by 2035,

In 2012, shale energy produced $62 billion in government revenue via taxes.

Between now and 2035, shale energy will contribute an estimated $2.5 trillion in total government revenue — with half going to the federal government.

Ohio is ranked among the Top 10 shale producing states based on number of workers.

With its 38,830 workers, Ohio is ranked No. 9 — behind Texas, North Dakota, California, Colorado, Oklahoma, Pennsylvania, Utah and Louisiana and ahead of Arkansas.

The number of Ohio jobs is projected to grow to 143,595 in 2020 and to 266,624 by 2035, said Christina Polesovsky, associate director of the Ohio Petroleum Council.

"These numbers reflect jobs from the first stages of exploration taking place in the Utica shale," she said in a statement. "Because of the significant investments made in Ohio and encouraging well results, the IHS is forecasting a substantial increase in oil and gas development jobs."

The latest analysis reveals that while the economic contributions are driven largely by activity in the 16 states with natural gas-oil production, a significant portion of the economic activity is located in the 32 non-producing states.

Those states will contribute nearly 500,000 jobs through businesses that sell goods and services critical to the lengthy supply chain that supports shale drilling, the study finds.

The Top 10 non-producing states in terms of jobs are New York, Illinois, Michigan, Florida, New Jersey, Minnesota, North Carolina, Georgia, Missouri and Wisconsin.

"The (shale) revolution is having a bigger impact across the country, including in non-producing states, than is generally recognized," said Daniel Yergin, vice chairman of IHS. "What we found is that the economic and financial links reach out across all the states in our highly-interconnected national economy."

"Looking ahead, the potential is there for the (shale) revolution to have an even broader impact on the U.S. economy," said John Larson, vice president, IHS public consulting. "By lowering the cost of key industrial inputs—such as natural gas—this (shale) revolution could help lay the foundation for a renaissance in U.S. manufacturing and increased competiveness in the global economy."

The new report offers a more precise estimate of the financial impacts of shale drilling than previous reports, said Christopher Guith, vice president for policy at the U.S. Chamber of Commerce.

The trajectories of economic projections in this report and those offered in previous reports "are very similar," he said in a telephone interview.

Shale gas has been a quiet and overlooked development in parts of Ohio and parts of the United States, he said.

Utica shale remains a work in progress in Ohio, but it is a "very, very promising" development, he said. "What’s happening is a good story," he said. "And it’s just beginning."

To access the report, go to www.uschamber.com.

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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.