Before 1848, the non-native population of California was approximately 1,000 people. After gold was discovered at Sutter’s Mill that same year, fortune hunters known as ’49ers flooded into the California territory, swelling the population of non-native Californians to 100,000 by the end of 1849 and firmly establishing San Francisco as a banking, manufacturing, shipping, and trade center of the west, a status that it still enjoys today. Presently, Pennsylvania is poised to be the next California. The Marcellus Shale gas play is a game changer, not only for Pittsburgh and Pennsylvania, but also the United States, and ultimately the world. It is a formation of sedimentary rock thousands of feet beneath the earth’s surface. Named for a town in upstate New York, this rock formation encompasses parts of upstate New York, about two-thirds of Pennsylvania, parts of West Virginia, and parts of Ohio. Its sedimentary rock is formed from organic material over millions of years. During its creation, natural gas is created as a byproduct, and is found in the tiny gaps and fissures of the rock.
This type of shale gas is found all over the world, but according to a 2011 study by Rice University, North America holds the greatest shale play in the world. There are several other gas plays in the U.S., most notably in North Dakota and Texas. In 2008, Terry Englander, a geoscience professor at Pennsylvania State University, and Gary Lash, a geology professor at State University of New York at Fredonia, shocked the energy world when their estimates that the Marcellus Shale formation contained not 1.9 trillion cubic feet of gas as previously thought, but an astounding figure of more than 500 trillion cubic feet of natural gas, enough to supply the U.S. for a decade or more. And each time the Marcellus Shale deposit has been studied since, the estimates have grown.
It has only been during the last few years that wells have begun to be drilled and gas extracted. Some are concerned about the environmental impact of the wells and the method of extracting the gas known as fracking. In September 2014, the findings of a landmark study conducted by the Department of Energy found no evidence that chemicals or contaminated water from the gas drilling process polluted drinking water at a site in western Pennsylvania. It found no fault with the fracking process but only with faulty well construction, which can be rectified, and with vigilant oversight can prevent contamination of the environment.
In North Dakota they have been extracting shale gas longer than Pennsylvania, and already the impact on the Peace Garden state’s economy is astounding. In Williston, North Dakota, the hub of the gas boom there, the population has soared, housing is in high demand, property values have increased, and wages have skyrocketed. In 2012, the Bismarck Tribune ran a story on the explosion of Corvette sales in North Dakota. “‘Sales are way up more than I ever dreamt was possible,’ said Patrick Murphy, owner of Murphy Motors. And Corvettes? Yup, those too, he says. He won’t say, or maybe he can’t or truly doesn’t know, if he’s selling more Corvettes than any other dealership in the upper Midwest, but he agrees he’s likely the No. 1 dealer in a four-state area.”
CNN Money ran a series of web articles on the boom in North Dakota, and among the findings cited was how North Dakota’s economy doubled in 11 years. The gas boom does not only mean more money for those companies drilling the wells, their workers, and state treasuries, but there is also a ripple effect. CNN Money also highlighted the businesses that have been founded to support the booming industry in a series called “I started a business in a boom town.” Everything from mobile food vendors to boutiques to businesses that boost mobile cell phone reception have been established to support the gas industry.
Pennsylvania’s burgeoning boom is starting to materialize. According to the February 2014 U.S. Bureau of Labor Statistic’s Monthly Labor Review, the Commonwealth of Pennsylvania has moved from the tenth spot in 2007 of employees working in the oil and gas field to the sixth spot in 2012. Our increase in annual average employment for those in the industry has increased 259.3 percent between the years of 2007 and 2012. It has also benefited wages. According to the same review, “while the state’s average annual pay increased by $5,158 (11.9 percent), to $48,397 in 2012, wages in Pennsylvania’s oil and natural gas industry rose by $22,104 (36.3 percent), to $82,974 in 2012. Another surprising finding from the Monthly Labor Review is that “Pennsylvania’s oil and natural gas industry is now larger than the coal mining industry for which the state is traditionally known.”
Marcellus Shale Benefits
But more than providing wealth to workers and tax revenue to coffers, Marcellus Shale has the potential to reorder who holds the power in the world. While many would like to deny the reality that whoever controls the natural resources controls the world, we cannot overlook the fact that the U.S. has been beholden to the Middle East for decades because we need its oil to keep our economy afloat and maintain our way of life. While alternative energy is appealing, at present, it will not provide enough energy to power our country. Unless you would like to revert back to a life like those of our pioneer forebears, we need energy.
How many jobs are we supposed to see from the gas extraction industry and the secondary businesses it generates? It’s hard to estimate, but jobs may not be the best benefit we receive from Marcellus Shale. With turmoil in Russia and the Middle East, our reliance on foreign energy is foolish at best and deadly at the worst. Many in the energy industry have offered this adage, “Frack a well, bring a soldier home.”
While a booming region, surging wages, a boost in business, and increasing tax revenues certainly make the Marcellus Shale play an economic gorilla, it is Marcellus Shale’s prospect of finally making the United States energy independent the biggest game changer of them all.