Concerning the Marcellus Play, local investment in workforce development is a huge risk. Not only is the legal geography uncertain, but the local geology poses some challenges:
In other "wet" gas formations like the Eagle Ford in Southwest Texas there's both existing gas processing capacity and existing connections to the U.S. Gulf Coast refining infrastructure, notes Nathan Ticatch, vice chairman of PetroLogistics. That gets the liquids, like ethane, to chemical plants that can use it to make products.The Marcellus is both without the processing capacity and far away from any plants that can crack ethane and other liquids, notes Bruce Bilger, the head of global energy for Lazard. There's a pipeline project being considered to move such liquids to the Mid-Atlantic states where there may be a use for them, but it's "just on the drawing board."The other options, says Ticatch, is a 1,500 mile pipeline to the Gulf refining complex. There's enough potential ethane production that would accompany Marcellus gas production to justify a project, but how long would it take for that production to become big enough for a pipeline to move forward?Another option: construction of a power plant the runs on ethane as a fuel. That would be a hard sell in the middle of Pennsylvania coal country, however, particularly since the plant would need to run around the clock, Ticatch said.
That's a big missing piece to talent migration puzzle. The workforce needs are unclear, as are the logistics of efficiently getting the gas to market. I haven't even scratched the surface of the demand issues.
A study this month from the state's Center for Workforce Information & Analysis estimated Marcellus Shale jobs could grow 55 percent from 2006 to 2016 to more than 12,400 positions statewide. Marcellus jobs in north-central Pennsylvania could rise by 62 percent to 2,700.Those are dramatic figures in a region where unemployment often hovers above the state average of 8.8 percent. The area has especially been hit hard in recent years by cuts in manufacturing and businesses related to the automobile industry.Unemployment in Potter County, where Coudersport is located, was 10.8 percent in January, according to seasonally adjusted figures from the state. Among neighboring counties, the unemployment rate was 10.7 percent in McKean, 8.8 percent in Tioga and 9.9 percent in Lycoming.Cameron County, the state's smallest county by population, has the worst unemployment — 16.9 percent of its civilian labor force of 2,300 is out of work.Gas companies drilling wells bring in many experienced workers from out-of-state to staff Pennsylvania rigs. The influx has brought challenges to small towns once reserved for bigger communities, like rising rents and a lack of affordable housing.Helene Nawrocki, the executive director of the Potter County Education Council who helped organize the Natural Gas Expo in Coudersport, would rather more of those jobs go to in-state residents.What in-state applicants may be lacking, though, are the proper skills. Area high schools, colleges and technical schools have started discussing how to offer training.
A lot could change between now and 2016. Will the boom last long enough to allow for the development of a permanent workforce? Until the dust settles, I don't think unconventional gas will have much of an impact on Western Pennsylvania. In the near term, better to stick with that mobile workforce ready to go where the action is.