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$1B pipeline in PA...

UGI's 'Commonwealth Pipeline' would spread shale wealth through Pennsylvania

DONALD GILLILAND, The Patriot-News (March 5, 2012)
Natural gas from the Marcellus Shale might be coming directly to the midstate.
A $1 billion natural gas pipeline has been proposed to run from Lycoming County south through the midstate. If built as proposed, the 200-mile pipeline would go south to the Baltimore and Washington markets.
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Natural gas pipeline companies get eminent domain status upon approval from the Federal Energy Regulatory Commission.

A partnership between a UGI Corp. subsidiary and two other energy companies floated the proposal last week.
The 30-inch Commonwealth Pipeline would pass "somewhere east of Harrisburg and west of Lancaster," UGI spokesman Peter Terranova said.
"It really runs right through the heart of the UGI central Pennsylvania market," Terranova said.
It would transport 7.8 million cubic feet of natural gas per day. At current rates, that's $5.1 million worth of gas a day.
Two of the three companies are expected to become the "anchor shippers" on the line: Valley Forge-based
UGI Energy Services Inc. and Capitol Energy Ventures Corp., a subsidiary of a company that provides gas to Washington, D.C.
The third company - Inergy Mid- stream, of Kansas City, Mo. - would build the line and run it.
The companies hope to have the line constructed and in service in 2015. There are many steps between now and then, and the proposal will undoubtedly face opposition from foes of shale drilling.
The pipeline is expected to cross and interconnect interstate pipelines along its route, providing direct access to new markets for Marcellus gas producers, according to a company news release.
All interstate pipelines are open access, meaning if a new company wants to connect and use them, the owner cannot say no.
"Our goal in participating in this project is to bring gas produced in Pennsylvania directly to the major markets in central and eastern Pennsylvania," said Bradley Hall, president of UGI Energy Services.
Later this month, the companies plan to announce an "open season" for the proposal, which is the first step in the regulatory process.
One industry insider equated it to "putting the toe in the water."
Usually lasting 30 to 60 days, an "open season" offers customers the opportunity to contract for capacity in the line. Those contracts help prove to regulators the project is necessary.
Terranova said the two "anchor shippers" expect to contract for 40 percent to 45 percent of the line capacity, so the project would need other customers for the remaining 55 percent to 60 percent.
There have been open seasons for projects that never were built because there wasn't sufficient demand, but that's unlikely here, according to industry observers.
Washington is a huge market for natural gas, and there are multiple gas-fired power projects proposed in southern Pennsylvania, northern Maryland and Virginia.
Terranova said the project is "obviously" aimed at the power generation market.
If there's enough interest, the project enters the "pre-filing" phase in which the
Federal Energy Regulatory Commission is put on notice. Then the clock starts ticking for the companies to notify landowners and municipalities, hold public meetings, obtain permits and begin gathering environmental data.
That process typically takes six months to a year, after which an official filing is submitted to the commission. The commission then determines if the project is necessary and in the public interest.
It's at this stage that questions about the potential environmental impact come to the fore.
But if recent action at the commission is any guide, the path might be relatively clear for the Commonwealth Pipeline.
The 39-mile
MARC1 pipeline project through Bradford, Sullivan and Lycoming counties was proposed to run north-south, connecting the Millennium pipeline that runs across southern New York, and the Tennessee and Transco pipelines that run east across Pennsylvania into New Jersey. The highly productive Marcellus gas fields sit in between.
The MARC1 is to be built by the same company - Inergy - that would build and operate the Commonwealth Pipeline.
The MARC1 was expected to cross more than 100 streams, many of them high quality. It would go through 41 wetlands, clear over 300 acres of forest and require the destruction of more than 200,000 mature trees.
It essentially opens up unbroken forest and turns it into an industrial zone, said Bridget Lee, an attorney with
Earthjustice in New York.
Earthjustice and environmental groups such as the
Sierra Club pleaded for a full environmental review of the proposal.
Environmental Protection Agency agreed with the environmental groups, but the Energy Regulatory Commission granted approval without that review.
"It is certainly not a good precedent," said Jan Jarrett, president of the environmental group
The Commonwealth Pipeline would extend from the terminus of the MARC1, south through the midstate.
Lee and Jarrett both said they believe a full environmental impact study should be conducted.
If the energy commission approves the project, the companies will acquire the ability to exercise eminent domain to secure rights-of way through the intended route.
Industry insiders say that is the option of last resort because it usually takes longer and is much more expensive than negotiating directly.
It's also often a public relations nightmare.
Jarrett suggested midstate lawmakers might see firsthand what they've wrought.
"Compressor stations will need to be built along the pipeline route, typically every 40 to 100 miles," Jarrett said.
The recently passed Marcellus legislation is widely known for instituting a fee on drilling. But it also "requires local governments to allow compressor stations in agricultural and industrial zones and as a conditional use in residential zones," Jarrett said.
"Pipelines must be allowed in all zones, including residential zones," she said. "So, if legislators in this area thought that Act 13 does not affect their constituents, they're about to find that that it certainly does."
Conversely, the pipeline also fulfills what many of those same lawmakers have urged: the use of Pennsylvania gas within Pennsylvania.
That sets it apart from other Marcellus pipeline projects, said Terranova.
Unlike projects currently under construction, which are primarily backed by gas producers to get their product out of the remote northeast and to a New England market, this line is backed by utilities that distribute to gas consumers and represent demand from the south.
"This is a project where you have two significant utilities stepping up," Terranova said, "and we're confident we'll get others stepping up to pull the gas south."
David Black, president and CEO of the
Harrisburg Regional Chamber, said getting cheap gas out of the Marcellus fields into the midstate "would be great for our region." The area could use that "gas advantage" to attract companies to the area.
"Companies that use gas tend to be higher-paying manufacturing companies," Black said. "Combine that with the high-tech advantage we have, and we could be more globally competitive than we are today."
"I think it would be a great advantage for us," Black said.

65,000 jobs coming to Ohio

Study tags 65,000 jobs, $4.9B boost to Ohio shale
COLUMBUS, Ohio — An academic team enlisted by Ohio's business sector released a study Tuesday that finds oil and gas drilling will mean more than 65,000 jobs and an almost $4.9 billion investment in the state's economy by 2014.

Findings of the eight-month study were released to the media and members of the Ohio Shale Coalition, a partnership of energy interests spearheaded by the Ohio Chamber of Commerce.

The group commissioned the study in hopes of displaying the benefits to Ohio's ailing economy of a boom in shale drilling, including the controversial practice of hydraulic fracturing, or fracking.

A team of economics, energy and geology experts from Cleveland State University, Ohio State University and Marietta College's Department of Petroleum put together the report.

It found that by 2014, about $4.9 billion would be invested in Ohio's economy by the industry; almost 66,000 jobs would be created or "supported" by industry growth; $433 million in local and state taxes would be generated; and energy companies would be paying wages and benefits totaling $3.3 billion.

Altogether, the industry will generate $1.7 billion for Ohio's economy this year, $5.8 billion next year, and nearly $10 billion in 2014, the research found. Gross state product could grow by 1 percent, a significant increase from the 0.6 percent average for the past 13 years.

"This really has the potential of being transformational," said Ned Hill, dean of the urban affairs college at Cleveland State University and one of the researchers.

State Rep. Robert Hagan, a Youngstown Democrat, said he is hopeful for the benefits that will come to his northeast Ohio region from the new industry — but the industry is moving too fast, and without checks and balances.

He announced Tuesday that he has gathered 1,500 signatures from his constituents — whose area has been struck by a series of 11 earthquakes potentially linked to high-pressure injection of fracking wastewater into the earth. The petitions seek legislative hearings on fracking. The practice stimulates gas production by blasting millions of gallons of chemically treated water into a well drilled horizontally through shale about a mile underground.

"We admit that it's moving, but we will not say that we are going to ignore the safety factors, the environmental factors," he said.

Ohio Department of Natural Resources spokesman Carlo LoParo said the state is tripling the budget of its oil and gas division this year, due to increased drilling activity.

"We will have more than 110 inspectors and field staff in our oil and gas division to make sure all laws and environmental regulations are observed and enforced," he said. Money for that endeavor comes from fees assessed on the oil and gas industry, he said.

Employment projections contained in the report include both new and "supported" jobs, 16,000 in the service sector. That sector includes hotels, restaurants, doctors and other personal services. It anticipates 1,000 environmental compliance officers, construction jobs

Douglas Southgate, co-director of the Subsurface Energy Resource Center at Ohio State University, said the shale industry plays to Ohio's economic strengths, in the areas of manufacturing, plastics, and R&D.

Hagan, and fellow Democratic Reps. Mike Foley and Kenny Yuko are backing a proposal raising the state severance tax on recovery gas wells to 7 percent. The new rate would eventually raise proceeds from $2.6 million to $500 million. Some of that would be earmarked for local communities and alternative energy development.

Gov. John Kasich has called a moratorium within a 5-mile radius of a deep-injection well shut down after the Youngstown quakes, awaiting results of a state investigation into the cause. Deep-injection wells are for wastewater, and are not the same as wells for exploring or extracting oil and natural gas.

Source: CBS News

Baker Hughes to hire 700 people near Canton OH

Baker Huges to hire 700 people in Massillon, invest $64 million to serve shale gas industry
Published: Monday, February 27, 2012, 10:00 PM

CLEVELAND, Ohio -- Baker Hughes, one of the nation's leading oilfield services companies, plans to build a 700-job regional headquarters in Massillon.
The Massillon office would serve as the company's base for providing services to shale gas exploration companies in Ohio, Pennsylvania and surrounding states.
The Ohio Tax Credit Authority on Monday approved a 65 percent tax credit for the $64 million project. The state also approved several other Northeast Ohio business expansions at its regular monthly meeting. Calls to Baker were not immediately returned late Monday, but the company has been hinting at plans to build in this area for some time.
During a conference call with analysts and reporters last month, Baker President and Chief Executive Martin S. Craighead said the oilfield services company needed to cut the expense of shipping supplies across the country by establishing "seven new major facilities in 2012 within North American land operations, each located in key" shale gas regions.
Baker Hughes sells drill bits and chemicals used in drilling and offers a variety of services to drilling companies. Some of the chemicals the company sells get mixed with water to create hydraulic fracturing fluids, material that gets pumped into shale wells to break underground geological formations, allowing natural gas to flow.
Since last year,
dozens of companies have committed to hiring hundreds of Ohio workers to serve drilling efforts in Ohio. The Timken Co. said its decision to spend $225 million to expand its Faircrest Steel Plant near Canton, for example, was driven by expected demand for specialty steel for drilling companies. French company Vallourec announced plans in November to expand its steel operations in Youngstown as did Republic Steel in Lorain County.
In its application for state tax credits, Baker said it expects to hire 700 people with an annual payroll of nearly $46 million. That puts the average job at the new headquarters at about $65,000 per year.
While the Baker Hughes project was the largest approved Monday, several Northeast Ohio businesses got incentives to expand.
Certech, a New Jersey company that makes ceramic components used in metal casting, received tax breaks to invest $6.6 million and create 80 jobs in Twinsburg. The company would also retain an undisclosed number of existing employees. The company received a 50-percent tax credit for the investment over the next six years.
AirGas USA, the industrial company that supplies welding equipment and gasses and other industrial gasses, received a 45 percent tax credit for a $2.6 million expansion project that would create 64 new jobs in Independence. The project would be a renovation and expansion of the company's existing operations there.
Blue Tractor Foods, a snack food company in Geauga County's South Russell, would create 51 new jobs and retain a small number of existing employees there. The company would receive a 40-percent tax break for its investment. The state did not disclose how much Blue Tractor plans to invest.


Shale job training in Northeast Ohio

Local training available for shale-related jobs
February 13, 2012
By VIRGINIA SHANK - Staff reporter ( , Tribune Chronicle |

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As the Marcellus and Utica Shale shale gas industry continues to boom local educators are moving fast to prepare students for today's job market.
Institutions such as Eastern Gateway Community College and Youngstown State University have developed programs geared toward training students to move into jobs associated with the shale industry.
''We're trying to meet that need by helping students learn the skills they need for those jobs,'' explained Ann Koon, Eastern Gateway's public information director.
For example, Eastern Gateway and Warren City officials recently announced a collaborative effort to bring the college's workforce gas training to the city. They plan to conduct a meeting this spring to present information about the college's pre-employment training for high-priority occupations targeted by the ShaleNET grant a federal funding program for training workers for jobs that are highest in demand in the industry. These jobs include general laborer (roughnecks and roustabouts), heavy equipment operators and commercial truck drivers, among others.
Through the ShaleNET grant Eastern Gateway's workforce development department is participating in workforce training, acting as a partner to the ShaleNET grant. Tracee Joltes, Eastern Gateway's assistant director of workforce development, explained part of this partnership calls for the college to coordinate gas training efforts with the career centers in the Mahoning Valley.
The funding allows the college to offer these initial classes to qualified applicants for free or at discounted rates.
The ShaleNET grant was launched in 2011 with a $4.96 million community-based job training grant from the U.S. Department of Labor, Employment and Training Administration. Eastern Gateway is the only college in Ohio participating in this grant program, Koon explained.
YSU recently announced the development of the Natural Gas and Water Resources Institute to also educate professionals for the emerging shale natural gas industry and provide research on the environmental impact of gas exploration. Ron Cole, YSU communications director, said the institute will provide bachelor's degree-level courses in science and engineering that will lead to an academic minor in gas technologies and also will provide research opportunities for industry focusing on analysis of water used in the shale gas extraction process.

1.6MM Shale Jobs!

Just read this article in the Business Journal for Youngstown, Ohio... more great news on the shale job front!

Published by The Business Journal, Youngstown, Ohio

Industry Study: 1.6M Shale Jobs by 2035

America's Natural Gas Alliance
releases study results.

YOUNGSTOWN, Ohio -- America's Natural Gas Alliance, an industry trade group based in Washington, D.C., says shale gas production will support more than 800,000 jobs nationwide by 2015 and 1.6 million jobs by 2035, and "generate more than $933 billion in federal, state and local government tax revenues and federal royalty payments over the next 25 years."

The Alliance released the results of a report prepared by IHS Global Insight, Englewood, Colo. "At a time when our nation's economy is still suffering from a downturn and jobs are top-of-mind for many Americans, the impact of shale gas on employment is invaluable. Last year, shale plays supported 600,000 jobs, and by 2035, the study projects that shale gas will support more than 1.6 million jobs," said Regina Hopper, president of the Alliance.

"Capital investment as a result of shale gas production is expected to total nearly $1.9 trillion between 2010 and 2035," she continued. "As natural gas prices remain low with increased shale gas production, electricity costs are lower and the overall stronger economy will bring to every American household a savings of $926 per year between 2012 and 2015."

In 2010, shale gas represented 27% of US natural gas production. Within the next five years, this share will grow to 43% and is expected to increase to 60% by 2035, the report found.

In addition to the jobs, economic value, and government revenues generated by this industry, [the report] also present[s] the broader macroeconomic impacts for both households and businesses," America's Natural Gas Alliance said.

"For example, in the absence of the shale plays, the price of natural gas would be nearly triple what it is today. In turn, lower prices today provide a significant near-term boost to economic output and employment and are an important foundation for an increase in domestic manufacturing. This is especially true in those industries that are intensive users of natural gas as a feedstock (transforming molecules into materials), such as the chemicals industry, and industries that significantly benefit from lower costs for electricity."

Here is the text of the report's summary as released by America's Natural Gas Alliance:

More than 1.6 Million Jobs

The economic contribution of shale gas is measured by the sum of its direct contribution, its indirect contribution from shale's supplier industries, and an induced economic contribution resulting from further spending throughout the US economy. The employment contribution takes on added significance at a time when jobs have become a top national issue. In 2010, the shale gas industry supported over 600,000 jobs, which included 148,000 direct jobs in the US, nearly 194,000 indirect jobs in supplying industries, and more than 259,000 induced jobs. By 2035, the shale gas industry will support a total of over 1.6 million jobs across the US economy, comprised of more than 360,000 direct jobs, over 547,000 indirect jobs, and over 752,000 induced jobs.

$231 Billion in Total Value Added

In terms of its value-added contribution to GDP, the shale gas industry will contribute over $76 billion in 2010 alone. This will increase to $118 billion by 2015 and will nearly triple to $231 billion in 2035.

$933 Billion in Tax Revenues

Furthermore, in 2010 the industry contributed $18.6 billion in government tax revenues, comprised of federal, state and local taxes, and federal royalty payments. By 2035, this amount will grow to $57 billion.

On a cumulative basis, the shale gas industry will generate more than$933 billion1 in tax revenues over the next 25 years.

$1.9 Trillion Capital Expansion

IHS Global Insight expects nearly $1.9 trillion in capital expenditures to be made between 2010 and 2035. At the same time, there are significant near term benefits associated with this expansion. By 2015 alone, annual capital expenditures in support of the shale gas expansion will grow to $48 billion from $33 billion in 2010.

Macroeconomic Benefits of Lower Gas Prices

In addition to the industry's direct economic contributions, the industry has fostered low and stable gas prices that have a positive macroeconomic impact. A simulation of IHS Global Insight's Macroeconomic Model of the U.S. Economy shows that, in the near term, current low and stable gas prices contribute to a 10% reduction in electricity costs, a 1.1% increase in the level of GDP by 2013, 1 million more employed individuals by2014, and 809,000 more employed by 2015. In the long run (beyond 15 years), the equilibrating tendency of the economy drives GDP, and the employment impacts of low versus high gas prices, to less significant levels, but low gas prices still bring noteworthy benefits. For example, there will be improvements in the competitiveness of domestic manufacturers due to lower natural gas and electricity costs. This will result in an initial impact of 2.9% higher industrial production by 2017 and 4.7% higher production by 2035. In addition, the near-term employment impact coincides with a period in which the US economy is marked by slow growth and high unemployment.

An Industrial Recovery and Renaissance

Finally, low and stable gas prices benefit a wide range of domestic manufacturing industries, particularly those that are dependent on gas as a feedstock and/or energy source. As a result of their confidence in an extended period of low natural gas prices, chemicals producers have already signaled their intentions to increase capacity. For example, Royal Dutch Shell, The Williams Companies, Lyondell Basell, and Westlake Chemical Corporation have announced expansions to their existing assets. Chevron Phillips Chemical Company LLC (a joint venture between Chevron and ConocoPhillips) and ExxonMobil Corporation have announced major future capital investment plans. Dow Chemical Company has made actual investments and has announced additional investments. Qualitatively, low gas prices will spur increased investment and jobs in the chemicals industry. Other manufacturing industries will experience a general increase in profitability and international competitiveness that will allow for an incremental but broad general increase in US manufacturing.


In summary, the shale gas industry makes a significant contribution to the US economy both in terms of direct employment, the many and diverse connections it has with supplier industries, and the amount of spending that this direct and indirect activity supports throughout the economy. As the production of shale gas expands over the next 25 years, the industry's economic contribution will expand significantly. By 2035, over 1.6 million jobs will be supported by the shale gas industry, which will contribute an additional $200 billion in government revenues. In the short term, lower gas prices will generate net GDP and employment growth, and, in the longer term, will positively impact overall manufacturing profitability and competitiveness in the United States, especially in the chemicals industry.

SOURCE: America's Natural Gas Alliance release of report prepared by IHS Global Insight.

Published by The Business Journal, Youngstown, Ohio.

FrackNation film - the truth about fracking

A new film is in the works... FrackNation. Looks like this is a great team to support... an excerpt from their website is listed below. Check them out at and support the cause!

from FrackNation site:

Dear Backers
$150,000 is the absolute minimum we need to finish FrackNation - the more we get - the better the film will be. Also it is important to know if we don't reach the full amount of $150,000 within the 60 days, Kickstarter will return all pledged money to the backers and NOTHING will go to FrackNation. So please send what you can, help us reach the $150,000 target within the 60 days and become an Executive Producer of FrackNation the documentary.
If you need any assistance or have any problems with placing the donation, please call us at 310 591 8663 between 8 am and 4 pm Pacific Time.
There are two sides of every story and then there is the truth.
FrackNation is the film that will tell the truth about fracking. 
People across the US told us that everything we had heard about fracking was wrong. They say that anti-fracking campaigns, one-sided media coverage and moratoriums and bans have damaged the lives of thousands of people who are now desperate to have their voices heard.

New report shows strong trend in shale job creation

Hiring for Shale Mining Jobs Is Growing Steadily
By Abby Lombardi on February 8, 2012 in Engineering, Oil Gas and Mining.
A report released in December 2011 reported that shale mining supported 600,000 workers in the US and, if 'fracking' continues, is projected to grow to 870,000 by 2015. While this is a controversial topic for many, we wanted to take a look at how many jobs have been recently advertised that are related to shale gas extraction.
Over the past 90 days, there have been just over 1,000 jobs advertised online that included the terms "shale" or "frack." This is a 70% increase compared to the same 90-day period one year ago. There were about 5,600 total jobs posted online in the oil, quarrying, and mining sector over the past 90 days, meaning that shale-related jobs account for about 18% of all jobs in this sector.

Hiring Trend for Shale Workers over Past 4 Years


Source: WANTED Analytics

Some of the most demanded occupations are Engineers. Petroleum Engineers saw the most jobs advertised online, with more than 100 unique listings at a 16% year-over-year increase. Civil Engineers, Environmental Engineers, Engineering Managers, and Industrial Engineers were also among the top 10 most demanded jobs. Other high-demand jobs in this 90-day period were Geo-scientists, Truck Drivers, First-line Managers of Extraction or Production workers, and Operations Managers finished off the 10 most advertised jobs. All of these occupations saw increases in ad volume, with Environmental Engineers seeing the most growth – over 400%. Below are some of the most commonly advertised job titles:

  • Reservoir Engineer
  • Geologist
  • Production Engineer
  • Drilling Engineer
  • Petrophysicist (or Senior Petrophysicist)
  • Completions Engineer
  • Geophysicist
  • Document Control Lead
  • Petroleum Engineer
  • Geoscience Advisor Exploration – Unconventional
The 5 cities with the most hiring for shale workers over this 90-day time period were Houston, Pittsburgh, Denver, Dallas, and Philadelphia. 4 of these 5 cities saw year-over-year increases in job listings. Only Dallas saw a decline when compared to the same period last year.

Hiring Trends for the 5 Cities with the Most Shale-Related Job Ads


Source: WANTED Analytics

Want to find out more about hiring trends in the oil and gas industries? Sign up for a free trial of WANTED Analytics to see hiring demand in any US city, average salary ranges for jobs, and how hard-to-recruit these openings are likely to be.

Halliburton bringing 300 shale jobs to Ohio

Good news for Zanesville area...
It's now official; the Zanesville-Muskingum County Port Authority has signed an agreement for energy provider Halliburton to move into the Eastpointe Business Park.
The agreement was signed Friday after a 60-day due diligence period, and will bring 300 jobs to the area.
Executive Director, Mike Jacoby hopes that the Halliburton deal will lead to more development deals with other big-name companies in the future.
"They're a very big company with a great reputation, and they will probably, I hope, bring along other companies that promote goods and services to Halliburton," said Jacoby.
Upgrades will have to be made to the business park, including water line extension and rail line access; a process that Jacoby said has been in the works.
"This is just another step toward getting the deal done. it was a big step obviously, an important step, but we're not having any big parties yet," added Jacoby.  "I mean, there is still a lot of work that needs to happen."
Jacoby said the construction process is expected to begin soon.
Halliburton is the 3rd Fortune 500 company to join the Eastpointe Business Park
Source: Gabe Ross, WhizNews

Whitehouse and Natural Gas

Source: Wall St. Journal (Jan. 17, 2012)

Obama Discovers Natural Gas
Another election-year transformation.

A re-election campaign is a terrible thing to waste, and this year's race is already producing miraculous changes at the Obama White House: The latest example of a bear walking on its hind legs is the President's new embrace of . . . natural gas from shale.
Last week the White House issued its latest report on jobs and it includes a section on "America's Natural Resource Boom." The report avers that a few years ago there were widespread "fears of a looming natural gas shortage," but that "the discovery of new natural gas reserves, such as the Marcellus Shale, and the development of hydraulic fracturing techniques to extract natural gas from these reserves has led to rapidly growing domestic production and relatively low domestic prices for households and downstream industrial users."
Please pass the smelling salts to Interior Secretary Ken Salazar and Lisa Jackson at the Environmental Protection Agency.
To the best of our knowledge, this is the first time the White House has favorably mentioned the Marcellus Shale, the natural gas reservoir below Pennsylvania, West Virginia and other Northeastern states. And now he's taking credit for this soaring production.
As the White House report puts it: "Of the major fossil fuels, natural gas is the cleanest and least carbonā€intensive for electric power generation. By keeping domestic energy costs relatively low, this resource also supports energy intensive manufacturing in the United States. In fact, companies like Dow Chemical and Westlake Chemical have announced intentions to make major investments in new facilities over the next several years."
And that's not all: "In addition, firms that provide equipment for shale gas production have announced major investments in the U.S., including Vallourec's $650 million plant for steel pipes in Ohio. An abundant local supply will translate into relatively low costs for the industries that use natural gas as an input. Expansion in these industries, including industrial chemicals and fertilizers, will boost investment and exports in the coming years, generating new jobs."
We checked to see if someone slipped a press release from the Natural Gas Council into the White House report by mistake, but apparently not.
The report does add the obligatory disclaimer about hydraulic fracturing that "appropriate care must to be taken to ensure that America's natural resources are extracted in a safe and environmentally responsible manner" with safeguards "to protect public health and safety." But no one disagrees with that.
The catch is that this endorsement runs against every energy policy pursued by the Obama Administration for three years. The Institute for Energy Research reports that royalties from oil and gas drilling have fallen more than 90% since 2008 because of Interior Department permitting delays and rejections.
The EPA recently issued a flawed report on groundwater contamination that could shut down the fracking process the President is now touting as a jobs producer. EPA's political goal is to grab power to supercede state drilling regulation. The industry regards new EPA authority as a real threat to its future.
Each year Mr. Obama has also supported a $40 billion tax hike on the oil and gas industry because, as he put it in 2009, the tax code "encourages overproduction of oil and gas" and "is detrimental to long-term energy security." Even the Securities and Exchange Commission has imposed extensive new reporting requirements on oil and gas fracking companies.
It's certainly smart politics for Mr. Obama to distance himself from the anti-fossil fuels obsessives, and no doubt his political advisers are hoping it helps this fall in the likes of Ohio and Pennsylvania. On the other hand, this could be a one-year wonder, and if he wins Mr. Obama might revert to form in 2013. A good test of his sincerity would be to replace Ms. Jackson and Mr. Salazar.

2012 Natural Gas Price Forecast

Great article... it’s important when hunting for a job in this sector to understand some of the economic forces at play...

BY JACK BARNES, Global Macro Trends Specialist, Money Morning (Jan 16, 2012)
I've been watching natural gas for years now and find myself shaking my head lately.

The cost to buy the "clean
energy" is collapsing as crude oil, a product that needs refining, stays above $100 per barrel.

In fact, this chart for natural gas is what I call a Widow Maker.

Take a look:


As you can see, it shows the price of the March 2012 NG contract over the past two years - and it's not pretty.

Why Natural Gas Prices Will Continue to Drop
The last time I wrote about natural gas for Buy, Sell or Hold was November 2010.

At the time, natural gas was about to start its most seasonally bullish period of the year. I recommended a multi-month
trade with an exit by the end of the March 2011 contract.

However, this year is completely different. Natural gas has collapsed in price instead of climbing during the peak winter cold months.

While it's been a warmer than normal winter across the United States, especially in the Snow Belt, this price drop has more to do with U.S. production rising on a year-over-year basis than it does the weather.

Ordinarily, the ratio of gas to oil on a BTU basis is 6.1. Today, with natural gas selling for $2.65 or so and crude over $100, though, the same ratio is currently 37:1 - not even close to the historical benchmark.

The next chart explains why natural gas pricing is going down and will stay down longer than most people expect.

Currently, the number of natural gas rigs is still climbing in the Eagle Ford area, while remaining level in the Bakken and Marcellus shale formations.

Why this matters is simple: These rig counts will have an impact on U.S. natural gas prices far into the future.

Here's why.

Eagle Ford shale wells, while called "gas," have a "wet sweet" production profile. In other words, they also produce natural gas liquids.

These liquids are super sweet (that is, they are very low in sulfur) and make a great blending stock with heavy sour oil, allowing producers to take two products derived at sub-spot crude
oil prices and blend them into a West Texas Intermediate (WTI) equivalent.

Again, these wells are being drilled for their crude oil-like liquids rather than their gas, at close to $100 a barrel for crude versus about $2.65 for natural gas.

The kicker? They typically have to produce the gas anyway to lift the liquids out.

As a result, the natural gas market stays saturated with new incremental supplies, which works to keep natural gas prices low.


I expect this trend to continue into 2012, making higher natural gas prices unlikely.

Oversupply: A Glut of Natural Gas
A bit of history shows us why...

Before the buildout of natural gas combined-cycle power plants in the 1990s, the United States had a yearly glut in gas. Producers actually shut down their production wells for months at a time.

What's more, there was no takeoff capacity to produce more gas, since the pipelines were full and the storage facilities were maxed out.

Today, we have returned to a similar environment.

In fact, the United States has a large selection of individual natural gas basins and prices are rarely the same in each, due to pipeline takeoff capacity and other similar factors.

As a result, we could see individual basins with a short-term price of $0.00 per Mcf (1,000 cubic feet) this summer. That's no typo. The cost of natural gas in certain places could go to zero.

Further, I expect to see un-hedged natural gas producers go bankrupt this fall, since the cost to carry production on leased lands exceeds the value of the cash flows from the fields.

You see, natural gas will be worthless to its producers for a period of days or weeks at a time.

This will impact the top and bottom lines of companies that have to produce, let alone sell, into that environment.

There may even be localized negative rates created when a company has to produce from lease properties or return the ownership to the mineral rights holders.

It is a case where companies put millions into drilling wells on a ranch and then can't sell their product because there is no market for it.

The Long Term Outlook for Natural Gas
I don't expect to see a clear trend change in natural gas prices until 2013 or later depending upon the buildout of U.S. liquid natural gas export capacity.

The U.S.
government has received a growing list of requests from LNG import facilities, to allow them to be converted into LNG export facilities. These conversion projects will start to come online in 2015. So far there have been plans submitted to export the equivalent of 17% of the United States' daily natural gas production, but for now that production has to sell within the United States - or not.

If all of these facilities are built, the United States could be the world's
largest liquid natural gas exporter by 2020. Just a few years ago the United States was projected to be the largest consumer of liquid natural gas by 2020.

Needless to say, the swing from one extreme to the other has been staggering.

In the meantime, smart investors will stay out of the way of the Widow Maker. Expect natural gas prices to stay low for 2012 and beyond.

It is also time to start considering the impacts that a natural gas glut will have on the companies providing drilling supplies to the exploration and production (E&P) companies.

Some high-flying
stocks in the O&G service sector will be negatively impacted when the rush to drill and frack a shale well is over. The golden days of the shale rush are just about over and with that, a return to gravity for some of these high-flying stocks.

12,000 Jobs with "Cracker" Petrochemical Plant (WV, OH, or PA)

Upbeat speech given on success of West Virginia
January 12, 2012
Source: LAWRENCE MESSINA - Associated Press Writer , The Intelligencer / Wheeling News-Register, Jan 12, 2012
CHARLESTON - West Virginia would slash property taxes in exchange for a new "cracker" plant and reserve funds to improve roads, schools and high-speed Internet access, under proposals Gov. Earl Ray Tomblin offered the Legislature in his State of the State address Wednesday.
The Logan County Democrat urged lawmakers to help the state compete with neighboring Marcellus producers Ohio and Pennsylvania for the
12,000 manufacturing jobs estimated to accompany such a petrochemical processing plant. He cited how the industry already has welcomed what it considers a clear set of rules for West Virginia Marcellus operations, approved in last month's special session. The Marcellus shale field is considered among the world's richest natural gas reserves.
Tomblin didn't detail his plan to lawmakers for attracting the plant to West Virginia. But in a prior interview, Tomblin said his proposal would shrink business property taxes for 25 years for any employer that invests at least $3 billion in a new plant. This highly sought facility would convert a byproduct from Marcellus shale natural gas wells - ethane - into a widely used chemical industry compound.
Article Photos
AP Photo Gov. Earl Ray Tomblin waves to the crowd Wednesday before delivering his State of the State address at the Capitol in Charleston.

"I will do everything in my power to make sure that West Virginia is positioned to take full advantage of this opportunity," Tomblin told a House of Delegates chamber packed with legislators, other public officials and VIPs. "I will not limit our efforts to just one project or even two. We will compete for every project, every dollar of investment and every new job that relies on the natural resources with which we have been so blessed."
That's already happening, Tomblin said.
He announced that
drilling supplier Baker Hughes will create 275 jobs at a $40 million facility near the state's active Marcellus field. That was among several economic bright spots that also include the Boy Scouts of America holding its 2013 national jamboree and scouting's 2019 world jamboree at its new 10,600-acre reserve in southern West Virginia. The latter - the first time in 50 years that this gathering has been in the U.S. - should attract 80,000 scouts and their families, Tomblin added.

Youngstown Opens Mills Again... Jobs Being Created

By Mark Niquette and Romy Varghese (January 10, 2012, 12:54 PM EST)
Jan. 10 (Bloomberg) -- Thirty-four years after Black Monday, the day Youngstown Sheet & Tube announced shutdowns marking the end of the Ohio city’s steel era, a $650 million mill is coming to life thanks to the natural-gas drilling boom.
The factory for Vallourec SA’s V&M Star will have 350 workers and produce seamless pipes used in hydraulic fracturing, also known as fracking. It’s part of a development that an oil and gas industry study calculates will mean more than 200,000 jobs and $22 billion in economic output in Ohio by 2015 -- and which has neighboring states looking to get in on the action.
The new mill is rising about two miles (3.2 kilometers) from an injection well for disposing wastewater from fracking that has been closed after 11 earthquakes shook the Youngstown area last year. States that that sit atop shale formations are cashing in on the drilling and the expanding businesses that support it, even as the Ohio Department of Natural Resources reviews the earthquake data and the U.S. Environmental Protection Agency studies the effects of fracking on drinking water with an eye on possible nationwide regulations.
“This will be the biggest thing to hit the state of Ohio economically since maybe the plow,” Aubrey K. McClendon, chief executive officer of Chesapeake Energy Corp., the most active U.S. oil and natural-gas driller, said during an energy summit that Governor John Kasich convened in Columbus in September.
Shell Plans
Drillers have turned to fracking -- a process that injects water, sand and chemicals into rock to free natural gas -- in shale formations including the Marcellus and Utica below Ohio, New York, Pennsylvania, Maryland, West Virginia and parts of Kentucky and Tennessee. A boom in production helped cut prices 32 percent last year.
While some shale-gas development is anchored to the drilling sites, states are jockeying for spinoff investments such as a “world-scale” natural-gas processing plant that Royal Dutch Shell Plc said it plans to build in Ohio, Pennsylvania or West Virginia.
All three states say they have offered incentives to Shell, and Kasich flew to Houston in November to hand-deliver letters of support for the project.
“States compete every day for every business they can find,” Keith Burdette, West Virginia’s secretary of commerce, said in a telephone interview from Charleston. “Suddenly, there’s this vast new array of manufacturing opportunities that may be returning to this region of the country, and I think we’ll all be aggressively looking for every opportunity.”
Emulating Texas
Development of the shale-gas industry is one of Pennsylvania’s top priorities, C. Alan Walker, secretary of community and economic development, said in a Jan. 4 interview in Harrisburg. Republican Governor Tom Corbett has said he wants the state to be the “Texas of the natural-gas boom.”
Texas wants to be the Texas of the gas boom, too. Half of the eight most active U.S. oil- and gas-drilling regions are in the state, according to a December presentation by Pioneer Natural Resources Inc., a Dallas-based exploration and production company.
Oil and gas employment in the state increased by 18 percent to almost 238,000 during the year ended Oct. 31 and now exceeds the peak of the last energy boom in October 2008, according to the Texas Petro Index, a survey compiled by Amarillo economist Karr Ingham.
Bridge to Future
In Youngstown, which has lost more than half the 168,330 residents it had in 1950, V&M Star may help make the area the Utica Shale’s supply-chain capital, said Eric Planey, a vice president at the Youngstown/Warren Regional Chamber.
“I look at it as being a bridge from our past to our future,” Planey, whose father worked at Youngstown Sheet & Tube for 40 years, said in a Dec. 8 interview. “Our past was exclusively steel. It looks like our future is going to be significantly a part of the oil and gas and energy business.”
Even so, an Ohio State University analysis concluded last month that the industry study, prepared for the Ohio Oil & Gas Energy Education Program, “greatly overestimates” the economic impact. Environmental groups, including the Natural Resources Defense Council, say that job-hungry states are moving too fast to capitalize before fracking’s consequences are known.
Vanessa Pesec, president of the Network for Oil and Gas Accountability and Protection in Northeast Ohio, pointed to the earthquakes in the Youngstown area last year that she blames on the disposal well, including a 4.0-magnitude temblor on New Year’s Eve.
“This is a short-term boom with long-term negative impacts,” Pesec said in a telephone interview.
Moratorium Urged
Yesterday, doctors at a conference on fracking in Arlington, Virginia, said the U.S. should declare a moratorium on the drilling process until the health effects are better understood.
David Mustine, general manager for energy of JobsOhio, the state’s development arm, said Ohio has strong regulations and he doesn’t think the complications from fracking will slow development. The state is benefiting from direct investment as well as jobs and lower natural-gas prices, he said. Oklahoma City-based Chesapeake alone has spent almost $2 billion in Ohio to acquire drilling rights, said McClendon, its CEO.
The money that drillers such as Chesapeake are paying landowners for leasing rights and royalties is buoying local economies, said Brad Hillyer, a lawyer in Uhrichsville. Landowners are being paid as much as $5,200 an acre plus royalties as high as 20 percent of the money from gas produced at a well, said Hillyer, who is negotiating leases.
No New Trucks
C.H. McCutcheon, general manager of Elder Ag & Turf Equipment Co. in East Palestine, estimated in a telephone interview that 25 percent of his business this year came from sales of equipment costing as much as $100,000 or more and paid for by lease payments that farmers received.
“If you take a look in western Pennsylvania and parts of eastern Ohio, if you go to the implement dealership, there ain’t no new tractors, red or green, and if you go to the local car dealership, there ain’t no new trucks,” Dale Arnold, director of Ohio Farm Bureau Federation’s energy services, said in an interview from Columbus.
The development “could bring an economic resurgence really to all of Ohio,” Kasich told reporters last month.
The impact is evident in Pennsylvania.
Collections of business taxes from oil and gas drilling in that state from January through November last year increased to $385.2 million, more than double the 2008 tally and a 64 percent increase from 2010, according to the revenue department.
Employment Gains
Employment by businesses directly involved in Marcellus shale grew 114 percent in the first quarter of 2011 from the same period in 2008, according to the Pennsylvania Center for Workforce Information and Analysis. Wages in Marcellus industries average $76,036, compared with the state average of $46,222, according to the center.
Pennsylvania wants to attract manufacturing related to drilling to “reindustrialize the state,” said Walker, the economic development secretary, who is former president of Bradford Energy Co.
The big prize is the so-called cracker plant that Shell plans in Ohio, Pennsylvania or West Virginia. An announcement is expected during the first quarter, Kelly op de Weegh, a company spokeswoman, said in a telephone interview. The plant would “crack,” or process ethane from natural gas to produce ethylene, which is used in the chemical and plastics industries.
Andrew Carnegie
The company will invest as much as $4 billion, Walker said, an amount he said equals what Andrew Carnegie put in U.S. Steel in the early 1900s.
The project will require as many as 10,000 construction jobs and “several hundred” full-time positions at the plant, op de Weegh said in an e-mail. For every plant job, there would be seven support workers, Walker said.
Walker, Ohio’s Mustine and West Virginia’s Burdette all declined to discuss what incentives their states are offering.
The states also are competing in other ways. In a letter to legislators in November urging them to consider shale bills, Corbett cited Ohio’s “broad and sweeping law” that pre-empts local ordinances and is being used as a “carrot” to draw businesses.
Ohio officials point to predictability in rules “as they continue to attempt to lure Pennsylvania jobs and investment across our western border,” Corbett wrote.
“We are certainly mindful of what the other states are doing,” said Patrick Henderson, Corbett’s energy executive. “The governor is committed to being as competitive as we can.”
--With assistance from David Mildenberg in Austin, Texas, and Jim Efstathiou Jr. in New York. Editors: Stephen Merelman, Mark Schoifet

Fox News Video - Shale Industry Creating Thousands of Jobs

Weighing Shale's Economic, Environmental Impact

Ken Silverstein | Dec 07, 2011 (EnergyBiz)

With the 2012 presidential election just around the corner, the top issue remains that of job creation. To that end, the shale gas sector says that it is poised to bolster the nation’s wealth in the form of jobs and gross economic output. The topic is arising at the same time that the nation is trying to shake off the great financial crisis of 2008, which many would say is the direct result of a banking and mortgage sector that had been allowed to run amok -- something that more federal oversight would have prevented. With that in mind, the various stakeholders are at odds over just what the Environmental Protection Agency’s function should be when it comes to regulating shale gas. “While natural gas holds promise for an increased role in our energy future, the EPA believes it is imperative that we access this resource in a way that protects drinking water sources and surface waters,” says Cynthia Dougherty, with EPA in congressional testimony. Consider that shale gas in 2008 comprised about 11 percent of all natural gas production. But by 2010, that number jumped to 27 percent and by 2015, it will be 43 percent. That’s according to IHS Global Insight, which says that by 2035 shale will amount to 60 percent of all natural gas production. EPA says that such prominence requires more of its attention. Specifically, it wants to cut volatile organic compounds, or smog levels, by 25 percent. But the EPA says that would be done by using proven technologies that can capture natural gas that currently escapes into the air -- gas that would be made available for sale. It goes on to say that this would result in an additional $30 million annually in sales for the gas industry -- more than enough to compensate the developers. “The ozone benefits are illusory, greatly inflated and would be dwarfed by the costs.  The standards may not be achievable and, worse, could destroy millions of American jobs.” says Howard Feldman, director of regulatory affairs for the American Petroleum Institute.   Meantime, EPA is studying the effects that the drilling for shale gas will have on drinking water. When developers use hydraulic fracturing, called fracking, to ply loose the shale from the rocks where it is embedded, they pump a concoction of water, sand and chemicals deep underground. Multiplier Effect Industry’s general viewpoint is that the states are in a better position to oversee shale gas extraction and that the federal government’s involvement will only complicate the situation. It also says that EPA is acting too aggressively and too quickly and that the agency is not permitting the stakeholders the time to give a proper response. This debate over the relationship between environmental regulation and job creation is coming during a time of persistently high unemployment. That’s why the shale gas sector says that now is not the time for EPA to muddy the waters. The IHS Global Insight study that is funded by gas developers emphasizes that shale gas production supported 600,000 last year and that this number will rise to 870,000 by 2015. It adds that the shale gas contribution to the U.S. gross domestic production was about $77 billion in 2010. That amount will be $118 billion in 2015 and $231 billion in 2035. A key reason for the shale gas industry’s profound economic impact is its high “employment multiplier”—the indirect and induced jobs created to support an industry. For every direct job created in the shale gas sector, more than three indirect and induced jobs are created, a rate higher than the financial and construction industries, the report finds. “The rapid growth in shale gas production—currently 34 percent of total U.S. production—is one of the most significant energy developments in recent decades and is having a significant impact on the nation's economy in terms of stimulating job creation and economic growth,” says IHS Vice President John Larson, the lead author of the study. The EPA readily acknowledges that the states have led when it comes to natural gas development. But it is arguing that because shale gas is such a game changer that the federal government must work with all the stakeholders to ensure that its extraction is safe and responsible. It is in everyone’s interest, it adds, to reduce emissions and to ensure that such harmful elements as metals and salts do not infiltrate the drinking water supplies. Right now, large segments are dissatisfied with industry’s positions. The White House does not see its actions as disrupting progress but rather, as helping to reassure a wavering public. If the affected communities are uneasy, then this promising industry could fail to reach to its expectations. EnergyBiz Insider is the Winner of the 2011 Online Column category awarded by Media Industry News, MIN. Ken Silverstein has also been named one of the Top Economics Journalists by Wall Street Economists. Follow Ken on

Ohio's Utica - Estimated # of New Jobs

Source: Idea Stream
Steve Linsky has been watching Ohio’s oil and gas industry up close. Just a few hundred years yards from his house east of Akron, stands a new oil and gas rig. It belongs to Chesapeake Energy, the nation’s second largest natural gas producer. The exploratory rig inspired Linsky to head to a job fair for Chesapeake, resume in hand.
Steve Linsky:  It was like you see this oil derrick go up and then, it was very interesting. I would love to be a part of this.
Linsky and nearly 300 job seekers packed the Akron Holiday Inn Express last month hoping to find new futures in oil and gas. Technological gains now allow drillers to access resources deep under Ohio previously thought unattainable. The practices of horizontal drilling and hydraulic fracturing, also known as fracking, have its critics who argue the techniques endanger drinking water. But energy companies disagree. Chesapeake’s CEO Aubrey McClendon has been investing heavily in land rights in Ohio’s Utica Shale. At an energy summit in Columbus this fall, McClendon estimated the value of the Utica’s oil and gas reserves at half a trillion dollars.
Aubrey McClendon: If you begin to think about spreading that kind of wealth across five or six counties and east central Ohio, I think you begin to see that this will be the biggest thing, I think, to hit the state of Ohio economically since maybe the plow.
Politicians are thrilled about the possibility of jobs, especially if they go to Ohioans. Here’s how Governor John Kasich put it at that same energy conference.
John Kaisch: I tell people that we don’t want any foreigners working on those well heads. To me, a foreigner is somebody from Kentucky, Pennsylvania, West Virginia, Michigan and Indiana, OK? (laughter)
The projections of shale-related jobs and who fills them is a hot issue, but only part of the picture. Growth in domestic natural gas production has boosted jobs in other states. For example, demand shot up this year for freight cars to haul sand used in hydraulic fracturing. That’s created hundreds of jobs in Arkansas and Missouri where those cars are made.
In shale states, an estimate of how many jobs are produced really depends on who’s doing the asking. An industry-funded analysis says Utica Shale development will create over 200,000 jobs by 2015 in Ohio alone. Some economists aren’t buying it. Ohio State University Professor Mark Partridge says shale job projections could turn out to be like “green” energy projections.
Mark Partridge: I think your listeners would be aware that industries and politicians typically exaggerate their job impacts.
Partridge says its helpful to look at jobs studies in neighboring Pennsylvania’s Marcellus Shale. Two separate Penn State studies, issued a year apart, came up with dramatically different job creation numbers:
One analysis was funded by the oil and gas industry. It credits Marcellus drilling in 2009 with creating about 44,000 jobs in Pennsylvania. The other study of the same year came in at about half that number - about 23,000 jobs. Penn State economist Timothy Kelsey says his team differed from the industry-funded group because they found that not all the jobs and money related to drilling are staying in-state.
Timothy Kelsey: People who are living and working in the community tend to spend more than the people who are here temporarily, holding the jobs and yet spending their money back home. And when you take into account that leakage, the estimate, it’s still 23,000 jobs. It’s still a lot of jobs, but it’s nowhere near the large numbers that have been hyped here.
Whatever the number of jobs created in Ohio turns out to be, it’s bound to help the state’s unemployment rate. Sue Thomas Sikora says her government -funded employment agency, the Guernsey County Opportunity Center in southeastern Ohio, has been flooded with calls from oil and gas companies. On one day she had as many as seven companies call looking for hires and even leads on office space.
Sue Thomas Sikora: For so long we have worked with companies who have been laying off or closing and so in the past year to have witnessed this complete 180, with companies now needing people, we’ll do whatever it takes to fulfill their needs.
Since July, Sikora says her office has referred about 700 Ohioans for interviews. Sikora says at least 100 of those referrals now have jobs with energy-related companies. 
Over the next few months, WCPN will examine Ohio’s burgeoning oil and natural gas economy. Next Friday, we’ll hear what community colleges are doing to train workers for the industry.

South Texas Jobs (Eagle Ford)

Short video on jobs being creating due to shale in Texas (Source Houston Chronicle, Nov 2011):

Shale Oil Creates Job Boom:

Many Eagle Ford Shale Jobs, But Few Qualified Workers


There are jobs in abundance in the Eagle Ford shale area, but a group of employers said Monday that it isn't easy to find qualified workers.
The employers got re-assurance Monday from officials with the
Texas Workforce Commission, which will help with job listings, training grants and pairing employers with community colleges to provide customized training. The commission sponsored a symposium in the San Antonio area Monday for Eagle Ford employers to talk about their needs.
Tom Pauken said the job opportunities in the Eagle Ford "are expected to last for an extended time" and will provide great opportunities to those who are hunting for jobs in a troubled economy.
But for now, employers are frustrated.
"The Achilles' heel we have is finding a qualified workforce," said
Byron Sprawls, South Texas area operations manager for Weatherford Fracturing Technologies, which recently hired 100 workers at its San Antonio office. The company, a unit of Weatherford International, provides hydraulic fracturing services and is looking to fill another 100 jobs.
The biggest need now is for drivers who hold commercial driver's licenses and are certified to transport hazardous materials, employers said.
The field of workers is winnowed at the start because some applicants can't pass the drug test for the training, employers said.
Some employers said they have relaxed their earlier requirement that applicants walk in the door with a commercial driver's license.
At Weatherford, "we've hired young men and women who know nothing about what we do," which isn't the company's usual way of doing business, Sprawls said. "It takes several months to get these people where they need to be."