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Is the Marcellus Shale Boom Over?

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TUNKHANNOCK -- The natural gas boom helped Tunkhannock recover quickly from the recession of 2008.

It helped Twigs Café Restaurant at the center of the Tunkhannock, thrive.

"Whether you agree with the industry or not it's really helped out a lot of the small towns and small businesses," said owner Lori Bogedin.

But in nearby Susquehanna County, the largest gas driller Cabot Oil and Gas has lowered its spending projections for the coming year.

A company spokesman blames an outdated pipeline system in our region that's already moving as much natural gas as it can handle.

"We have an abundance of natural gas here," said George Stark. "It can`t get to market, and it's lowered the price."

This week, the industry group, the Marcellus Shale Coalition is meeting near Wilkes-Barre.

The group`s chairman says every natural gas driller in Pennsylvania will be spending less on local operations.

"We've seen probably eight to nine billion dollars of planned capital expansion reduced in Pennsylvania as a result of pressure on this industry from a pricing perspective," said Coalition President David Spigelmyer.

Spigelmyer says the $8-9 billion reduction is calculated in lower production, and possibly layoffs.

Merchants in communities like Tunkhannock are concerned.  Royalty checks for local landowners might be smaller.  Less work might be available for local contractors for the gas companies.  It all means less money spent in the community.

"Of course you don't want to see anything taken away," said Bogedin at her busy restaurant, adding most merchants in Tunkhannock who profited from the boom can ride out what appears to be a coming slump.

But she adds communities in the Marcellus Shale region should be looking for ways to lessen their dependency on gas drillers.

"The area itself has got so many resources other than the gas industry," said Bogedin.

Natural Gas Industry analysts say they don't know how long the slowdown will last.

But David Spigelmyer says a new pipeline that could transport more gas to the east coast, and create more wealth for drillers, landowners, and communities, is at least five years away.

32 comments

  • george

    It’s just industry created market manipulation. Their goal is to raise prices in the U.S. and worldwide. Aubrey McClendon has stated this himself in Chesapeake’s own press releases. Most of these companies have already secured 20-30+ year deals to sell large percentages of all gas produced to India, China, and other foreign countries by shipping through LNG terminals. This slow down most likely coincides with the LNG terminals not being fully functional yet, although the goal when they first came in years ago was to start exporting LNG by 2015. Local news and media need to start doing some real reporting, however they will most likely lose advertising dollars from the propaganda they allow the industry to spew.

  • Swampdonkey

    All the diesel used in trucks, all the radon burn off, all sludge pumped down those holes.
    It will never be over for our grandkids, they will not forgive us.

  • Dave

    I read many posts on this news article and most go on a rant about political correctness, republican and democratic views on the subject ect and go at each others throat… It’s about a glut not about politics… However if you want to go into detail about the glut that could have been avoided then you should be paying attention tho those who you have voted in office of the United States Congress.. There was a bipartisan Bill introduced 9 years ago and voted on at least 3 times to help the nat gas industry .. Marino along with other Republican Congressman voted No every time.. I called his office to ask why and his answer was ” He did not want to give tax money to the industry.” The problem is it was not a tax giveaway but rather a tax write off if you spent money on building the industry up with things like converting vehicles for nat gas use and expanding pipelines in areas for homeowners use of gas rather than expensive propane..The great part about it is that all materials used would have to be American made there-by snowballing the economic effects ..It would have gotten us out of the recession faster and made many landowners richer in that area..I have come to believe that Marino and other were just going with the majority of those in Congress to not give Obama and credit for what could have been and they did it for basically Tea Party reasons of not doing anything for the past 8 years… So Next time you vote you might not want to shoot yourself in the foot up there because the guy your voting in voted against your best interest and I would imagine not many of you even know that and only vote because of pure hatred of another party..

    • Dave

      BTW the vote only missed passing by a few votes and a Bill Obama said he would sign..All Republican Congressman from Pa Voted NO….

  • Ken Klemow

    I suspect that we are seeing a temporary slowdown, rather than the demise of the industry. Shale gas development will be with us for decades, so we need to make it as safe as possible. But if we don’t like fracking and coal mining, here’s the plan: (1) blanket all of the ridgetops in PA with wind turbines, (2) cover our thousands of acres of abandoned minelands, rooftops, and other open spaces with solar arrays, (3) expand nuclear production, (4) find ways to reduce our energy consumption by at least 25%, (4) continue to find ways to reduce environmental and human health impacts of all forms of energy generation (pollution from fracking, bird deaths associated with wind turbines, environmental hazards associated with solar panel production, nuclear waste), (6) let’s work together to find solutions, stop demonizing individual forms of energy, and stop namecalling. Those measures will not solve our energy problems entirely, but they can at least put us in the right direction.

  • Timothy Tingley

    I feel like timetomove might be drinking fracking fluid. You’ll never grow if you can’t examine other people information without bias. People like this are really what’s wrong with America. They would rather spend all day telling you about how great Ronald Regan was than actually try to fix problems.

  • Timothy Tingley

    I am a third generation resident of nepa. I don’t think I’m smart, I know I’m informed. There is a difference. Don’t waste your time on petty conflicts. I am a dyed in the wool libertarian for your information . But, I understand that for the government to leave people alone, they have to be personally accountable. Same thing goes for industry.

  • Timothy Tingley

    Everyone around here has uninformed opinions they want to share. If you want to say fracking is safe, go read the ny state department of environmental protection report on its effect on drinking water and air quality Then we can compare our crooked state government to one that is actually protecting its citizens. If fracking is so safe why do they only do it in poor rural areas with crappy education…

  • Timothy Tingley

    The natural gas prices are too low to support the expense of the extraction process, so now they sell thier futures profits as securities. This is so they can lie about production , and falsely inflate the prices of thier futures. They have backed themselves into a corner , and now they have to fraud thier way out.

  • Timothy Tingley

    Also if they had to disclose what was really in those residual waste tanks, they would most definitely qualify as hazardous materials. This entire industry is dishonest and wnep is thier propaganda channel.

  • Timothy Tingley

    it is a well established fact that the natural gas companies are using dangerous chemicals in the well preparation process. That is why they hide behind proprietary recipe laws to keep what is in the cracking fluids secret. Those laws were made for coca cola and Pepsi, not toxic chemical being introduced into people’s groundwater. They don’t allow for air quality testing anywhere close to those rigs. The truth is one of those rigs blew out in Texas when it was being converted from vertical to horizontal drilling, the Texas dep measured the toxicity of the air, and found SEVERAL known carcinogens,and even chemicals that have been banned for use in America for forty years. The entire industry is being propped up by selling its futures.It is a boom/bust bubble cycle just like housing was in 2007…

    • Swampdonkey

      i voted for Reagan and i back you up sir.Flare burn off into overcast clouds/drizzle clouds just bring
      the burn off back to the fields,mountains, and streams of PA. NOTHING HAS BEEN SAID OF THIS..
      Every day is not the same here in PA. We can have many straight weeks of over cast clouds/rainy drizzly weather. I have 2 freak/anomalies now in my gardens.I eat my own grown food.

  • HENRY ROWENGARTNER

    So, if I read this article correctly, they said the price of gas is going down because they cant get enough to market. Umm, that drives the price up because supply can’t keep up with demand. My natural gas rate went up 15% this year over last. Who are you kidding? Sounds like a bunch of crap to me!

  • Valfreyja

    I know lots of parts of central Pennsylvania are hurting. Industrial farming and the exodus of other industrial pursuits to foreign soil over the last 30 years have been nothing shy of disastrous. But you were kidding yourself if you thought this was going to be a lasting industry.

    These snakes are going to do exactly what the old mining interests did when the coal and iron ran out: Flea.

  • Mr T

    Idk where some you people get your horror stories from, probably Gas Land. IF something happens with the natural gas industry they (the companies) do everything they can to fix or find out what went wrong so it won’t happen again. Certainly human error comes into play and you can’t predict against that. There is a definite danger involved in this industry, but as is in most all industries there are certain aspects that are dangerous. But at the amount of income that the industry had brought to towns and communities like my hometown Tunkhannock, there has been a great impact on the economy. There have been a need for industrial skills that the area did not have before. Including other jobs that were simply not there. In addition with technological development the industry is getting safer. What needs to happen is the development of natural gas infrastructure to bring forth the natural gas powered vehicles. We could become self dependent of foreign oil! Chevy currently has natural gas trucks on the roads. There are of course environmental risks you run with production, or transportation of the product (pipeline). You run into these same issues (in varying aspects) in every single energy industry on this planet. However, if we have people developing the next advancement in energy technology that will sustain ample power and be clean by all means fund that as well! I would like the earth to be here as much as the next guy cause I know we can’t leave this place. But when our country is just starting to return from the recession, coupled with a need for America to become strong in the international market again. I see no reason why we shouldn’t seek to have the natural gas industry thrive. Overall the reward is greater than the overall risk.

    Drill. Baby.Drill.

    • david hannigan

      I live gas land every day mr t.i live at 11961 sr 11 Harford twp weve been there since 1970 I just moved my mother to philly and im in Alabama to breath clean air your buddies put massive dirt on rt 11 and when trucks go by at 70 they sand blast us.this has been going on since 2010 everytime I try to clean rt 11 the state troopers show up to tell me that theres big changes going on and I better get to liking them yes trooper burns and rest of that rats nest Gibson barracks are running security for the gas company they say it cost too much for them to stop whacing me with their dirt and because of the money padot,dep,stae police,wont help I hope you never have to experience anything like this I understand your making good money but the heck with drill baby drill I want to breath baby breath if you have balls enough go stand outfront my house and see what gasland is all about. david c hannigan

  • John

    I have to ask, dean, Williams, James, you really don’t understand economics do you? Would you like our economy to strive or our adversaries? Would you rather nuclear and coal? Hahahaha or wind and sun? I think you maybe democrats. Our country needs to lift the ban on exportation and grow, we need to open more refineries and grow. We have a resource here that everyone needs that will make the U.S. Strong again. Steel and coal made our country and its basically gone now but we have something else now and you tree hugging hippies,with all that you use made from petrol everyday, don’t understand.

  • deanmars2013

    They are Champing at the Bit to get FERC approval for Huge Pipelines, ” to the East Coast”, NOT for “Public Need”, but to EXPORT LNG and Raise the Price Worldwide…Including right here at home. WNEP should wake up and smell the stench of Spigelmyer and Starks Mendacity!

  • William Huston

    Great comment, James. Pretty much just what I was going to say.
    Industry greed caused overproduction, which created a glut, which lowered prices.
    All they know how to do is drill wells. They think “more production” will solve every problem, including those problems caused by over production.

  • vera scroggins

    Usual false excuses from George Stark; like it’s pipeline issues at fault for falling prices and falling profits; there’s more to this …..He estimates the needed answer / pipeline is five years away; that’s a very long time for the Gas Industry and sounds like it’s demise is just around the corner…..it can’t survive five years……good news….

    • BZ22

      No, Spigelmyer made those statements about the pipeline and pricing. Don’t get your hopes too high too soon about them going away forever!

  • James Barth

    “We have an abundance of natural gas here,” said George Stark. “It can`t get to market, and it’s lowered the price.” Given that statement, how could increased pipeline capacity, increased supply, increase the price unless demand is increased, which is what the industry is trying to do, by begging for subsidies and investment for liquefying and exporting the gas, transforming coal fired electric generation plants, and, using shale gas for transport fuel in trucks, buses and so forth? This is all a plan for misuse of government subsidy and private investment in order to build yet another infrastructure that will fail even in the short term. Fracking is not our energy savior and future, non polluting renewables are.

    • M Torch

      To some extent, I agree with you. It’s not the best long term solution. But at the present time, there are no economically viable options. How do you tell a family earning below the poverty level to use more expensive, “pollutant free” options to heat their house or cook their food? The big government, liberal answer is always to tax the rich more. But that’s pulling someone down, not helping anyone up. I subscribe to an “all-of-the-above” plan. Let’s drill here and now and get what we can while we can, but keep a steady, healthy eye on the future when it’s going to run out. We should be working on solar, wind, and even wave energy technologies now. But not at the high cost of government subsidies when government already is bankrupting our children and grandchildren with foreign debt. Why not use some of our resources to sell to other governments and countries to help pay down our debt while slowly (but surely) working on the non-pollutant alternatives? Then, in 50 or 100 years, when the next generation takes over, they’ll be in a commanding position to live their lives fruitfully.

    • BZ22

      This was known and plotted before the election so maybe they should have helped Corbett out more if that was the true concern.

  • jim

    The bust is here.Every company is slowing down or stopped.Lots of layoffs and its getting worse everyday.

    • J

      Maybe Universal Well services can use the time to clean up there spills and silica sand they let spill all over there leased property in middle of Newberry(Williamsport).
      I am sure someday somebody will pay for all the cancer causing pollutants and frac water they spill. Someone should test there parking lots for pollutants and make them make it right. I am all for the economics of fracking,but purposely having employees lie amount amouts spilled and allowing water coming out of pumps to drain into the parking lot is morally wrong.

      • John

        What chemicals are cancer causing that are used and how do they get into the whatever you think they get into?

      • Amazed

        And maybe you can clean up your spelling and grammar. While you’re at it, find some facts to go along with your bad information.

Comments are closed.