Forum Touts Opportunities for Shale Jobs
YOUNGSTOWN, Ohio -- U.S. Rep. Bill Johnson visited North Dakota three weeks ago to get an idea of the impact of the Bakken shale play there and found a key difference with the Utica and Marcellus plays in this region.
“It’s like the gold rush out there. They are giving $5,000 signing bonuses to young people to work at McDonald’s," Johnson reported at a forum for educators, "Training Students for the Jobs of Today and Tomorrow," held Wednesday at Choffin Career Center.
In North Dakota, unemployment is at 3% and falling, and the energy grid is having trouble keeping up with the new demands being placed on it because of all the development, he related. And the Bakken shale play is “a fraction of the size of what we have here,” he continued, and exploration there is six or seven years ahead of development here.
“Our young people have so much opportunity looking ahead,” he emphasized.
Getting young people in the Mahoning Valley prepared to capitalize on those opportunities was the focus of the event. Johnson, R-6 Ohio, and his colleague, U.S. Rep. Tim Ryan, D-13 Ohio, joined energy industry and building trades representatives for panel discussions presented by the Eastern Ohio Education Partnership.
Johnson envisioned for the audience of business leaders and educators a technological boom around the oil and gas industry such as accompanied the quest to reach the moon in the 1960s, which gave birth to advances such as cellular phones, flat-screen televisions and medical technology that impact society today.
“Imagine what’s going to happen in eastern and southeastern Ohio as we launch a vision of becoming energy independent given that we in eastern and southeastern Ohio are sitting on top of what experts say is the world’s largest reservoir of oil and natural gas. We will again see millions of jobs created as industries crop up around harvesting this resource,” he said.
“We will see young people getting into programs and going to technical schools to get jobs in careers in domestic energy production,” he continued. “And at the end of the day, just like that space age, we will learn how to use, store, distribute and produce energy in ways that we’ve never imagined.”
Since the 1600s, the world’s power base has been centered around energy, Ryan observed. “Now we see another shift with what is happening right now under our feet,” he said. With the oil and gas development in the region, additive manufacturing, the activities of the Columbiana County Poet Authority and other developments, “We have an opportunity in the Mahoning Valley to diversify our economy in a way we’ve never seen before,” Ryan remarked.
New technology, such as the techniques that permit hydraulic fracturing, or fracking, and telemetry, is “bringing on more energy than any of us imagined even five or six years ago,” advised Rayola Dougher, senior economic adviser for the American Petroleum Institute. The challenge is navigating the new energy landscape, becoming aware of opportunities and taking advantage of those opportunities, she said.
Those additional energy resources will be needed as U.S. energy demand rises in the coming years, and a growing amount of that will be derived from shale. By 2035, Dougher said, shale gas will represent 49% of U.S. dry gas production. The United States is now the top producer of natural gas in the world, and is on target to the No. 1 producer of oil before the end of the decade.
“This is big. It’s revolutionary,” she said. “It’s bigger than splitting the atom has been in terms of bringing energy to the United States
In Ohio, oil and gas development in the Utica shale play contributed 38,830 jobs, a figure projected to grow to 143,595 in 2020 and to 266,624 in 2035, said Chris Zeigler, executive director of the Ohio Petroleum Council. From fourth quarter 2011 to the same period in 2012, core shale-related jobs increased nearly 18%, he reported.
Since December 2009, 831 permits for horizontal wells have been issued in the shale play, 466 wells have been drilled and 122 are in production, he said. Although those numbers seem small, “the encouraging part” is that while those represent less than 1% of all producing wells in Ohio, “they account for up to 12% of total gas production and 16% of oil production in Ohio,” he said.
The impact of the industry can be seen in sales tax receipts as well. From 2011 to 2012, Carroll County had a 33.7% increase in sales tax, Harrison County had a 25.6% increase and Columbiana County saw an 11.6% increase.
The building trades in the Mahoning Valley region has been “truly blessed” with work from the shale play as well as construction activity in the region due to hospital projects, retooling at General Motors’ Lordstown plant and infrastructure projects, said Don Crane, president of the Western Reserve Building and Construction Trades Council. “Each well site is a $4 million construction project,” he said. Those projects require operating engineers to move dirt, laborers to install different pieces of pipe, and pipefitters and electricians among others.
Speakers at the program focused on making students aware of and prepared for job opportunities in the region’s growing oil and gas industry, and in ensuring those opportunities are available to everyone.
“There are going to be tremendous opportunities in the oil and gas industry over the next decade or two right here in our community,” Ryan said. As private industry makes the investments to capitalize on these opportunities, the public sector’s obligation is to “create an environment where our young people can take advantage of this,” he continued. That includes the minority community and “making sure everybody has an opportunity as this tidal wave that we think is coming approaches,” he said
Because energy development is taking place in areas where minority groups represent 10% or more of the population, it provides “a wonderful opportunity, the likes of which this nation has never known, for the minority population to be in on the ground floor” of job creation, technical advances and business development, said Frank Stewart, a member of the board of directors of the American Association of Blacks in Energy.
The challenge for minorities to take advantage of those opportunities is that many iare unaware of them. Correcting that “falls to us in the industry,” he said.
Butch Taylor, business manager for Plumbers and Pipefitter Local 396, pointed to efforts under way to diversify its membership through initiatives including pre-apprenticeship programs.
Rhonda Reda, executive director of the Ohio and Gas Energy Education Program, addressed her organization’s efforts to increase the qualified workforce overall for oil and gas jobs. “It is about the trades. It is about career and technical colleges,” she remarked. “That is where our biggest demand is, not just in oil and gas but in many other industries where the shortage is.” The need is for welders, diesel mechanics and surveyors, among other occupations.
“One of our other big concerns is finding qualified workers,” she said. “We can provide the best training there is” but there is a problem if those workers aren’t prepared to work outside year round, or are unable to pass a drug test.
She also talked about an initiative to help K-8 teachers encourage their students in the STEM fields -- science, technology, engineering and mathematics -- though two-day workshops, and to provide scholarships for students.
Educators appeared interested in working with both Ryan and Johnson to get their students engaged in the job opportunities presented by the oil and gas industry.
“We need to let parents know what’s coming up because a lot of times parents feel there is no hope around here. This is something they can be hopeful for,” said Jill Merolla, supervisor of community outreach for Warren City Schools. I
Often, students and their parents want to know who they can benefit now and aren’t focused on looking down the road, said Connie Hathorn, superintendent of Youngstown City Schools. “So we have to present it to them in a way that this is going to be a career. We will train you. You just work with us. We can make it work for you,” he said.
Copyright 2013 The Business Journal, Youngstown, Ohio.
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