WHEELING, W.Va. – In the year 2020, West Virginia should produce 2 trillion cubic feet of natural gas – an amount nearly double the volume the state yielded last year.
Also, if even one of the multi-billion-dollar ethane cracker projects proposed for the Marcellus and Utica shale region by PTT Global Chemical, Royal Dutch Shell and Odebrecht comes to fruition, Eagle Manufacturing President Joe Eddy believes the region would see approximately $6 billion worth of annual economic growth.
“For four years in a row, we’ve seen at least a 35 percent growth rate in natural gas production,” John Deskins, director of the Bureau of Business and Economic Research at West Virginia University, told the business and government leaders gathered at Wheeling Island Hotel-Casino-Racetrack Wednesday.
Deskins’ report projects the Mountain State to produce the 2 Tcf by 2020.
For the purpose of his 2016 West Virginia Economic Outlook, Deskins classified the Wheeling area as including Belmont, Ohio, Marshall and Wetzel counties. Largely due to the burgeoning Marcellus and Utica shale boom, this area experienced a net gain of 1,600 jobs since 2010. This contrasts to net job losses for West Virginia as a whole during this period.
“Wheeling is an important driver of economic growth in the state of West Virginia,” Deskins said.
The bureau defines the Wheeling area as Ohio, Marshall, Wetzel and Belmont counties.
Later, Eddy said the Upper Ohio Valley is watching billions of dollars worth of economic opportunity flow to ethane crackers in Mont Belvieu, Texas and Sarnia, Ontario, Canada via large pipelines, such as the ATEX Express Pipeline.
Last week, MarkWest Energy Executive Vice President Greg S. Floerke said there are no concerns about the Utica and Marcellus producing enough ethane, but said storage of that ethane could be an obstacle for the region to land a cracker. Eddy agreed with this concept, noting this is an advantage for the Mont Belvieu area.
“If you put an ethane cracker in production, you need a constant supply of ethane. You need ethane storage,” he said. “That is why they are building all the crackers there, because they have a constant supply.”
“Historically, crackers do follow the ethane supply. This area is just getting on the map.” Curtis Wilkerson, spokesman for American Natural Gas Alliance, added.
Also during the conference, Marshall County Commissioner Bob Miller asked Abhi Khamerkar, natural resources specialist for Prudential Investment Management, about the volatile price of oil. Miller wondered if officials in Saudi Arabia and other OPEC nations are manipulating the market to lower the price in an effort to hinder U.S. producers.
“It’s a game of chicken,” Khamerkar said in reference to the oil producers wanting to see how much they can pressure the market.
Khamerkar also said that energy demand is growing in the Middle East because of increasing population and socioeconomic advances.
“It’s hot there in the summer. The demand for energy is going up,” he said in reference to the need to air conditioning.
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