If lithium-battery-powered vehicles are the future, then why is the Obama Administration pursuing new regulations that would make shipping the batteries so burdensome and expensive? We’ve examined the issue before here and here, and were pleased to see The Washington Post cover the issue in its Saturday edition, “Everyday lithium batteries at center of debate about cargo handling.” Excerpt:

The new regulations could affect a massive web of companies, including manufacturers, shippers and retailers. They say costs would be staggering. UPS told PHMSA that complying with the rules would cost the company at minimum $264 million in the first year. And the company said each subsequent year would cost an additional $185 million.

Best Buy submitted a long list of products that would be affected, including portable GPS devices, portable DVD players and TVs, cellphones, cordless headphones, universal remote controls, cameras, camcorders, even electric razors and toothbrushes.

In today’s Post, Robert Samuelson digs into natural gas and hydrofracturing today in his column, “Shale gas: Hope for our energy future.” Good and necessary introduction to the issue. We recommend it to whoever writes and edits the editorial page for The Philadelphia Inquirer, who should be ashamed for the bizarre attack against former Gov. Tom Ridge.

Ridge was hired last week to advise and represent the Marcellus Shale Coalition, companies and groups involved with the production of natural gas from the Marcellus Shale formation in Pennsylvania. In an editorial Friday, “Shale’s shill,” The Inquirer throws out the term “shill,” when describing advocacy for a major and growing contributor to the state’s economy and employment.

Former governors can choose many career paths. Some of them become college presidents. Some go on the lecture circuit.

And then there’s Tom Ridge, who is set to become a paid shill for the natural-gas drillers swarming his native state.

The Inquirer’s argument boils down to “there’s something obnoxious” about a former governor representing an industry “that poses serious environmental risks, and has already spent millions on lobbying to forestall paying its fair share of state business taxes.” Risk! Risk! If there’s risk, we must never act! As for taxes, well, that’s a matter of dispute.

It’s always bizarre to read newspaper writers who are offended by the exercise of the First Amendment, which is what Ridge has been hired to do — express a point of view and petition the government. One’s almost tempted to call the paper’s editorialists “hacks,” but that would be lowering ourselves to their level.

So we’ll just close by referring the editorialists to the Oil & Gas Journal’s recent story, “Study projects boost in Marcellus shale jobs, economy.”

How dare they report that!

Talk about your mixed messages. Sen. Harry Reid (D-NV) unveiled an “energy” bill on Tuesday that would spend $3.8 billion on rebates to retrofit trucks and other fleet vehicles to natural gas. But at the same time, the bill embraces the environmentalists’ favorite line of attack against hydrofracturing, the technology used to develop the nation’s abundant deposits of shale gas.

From CQ Politics, “Reid’s Energy Bill Revives Fight Over Hydraulic Fracturing“:

Senate Republicans and small oil and gas producers are crying foul over a provision in Majority Leader Harry Reid ’s energy bill that would impose new chemical disclosure requirements on a controversial onshore drilling technique.

The language, included in Reid’s energy bill released Tuesday night, would force companies to publicly disclose the chemicals involved in hydraulic fracturing to extract natural gas from shale deposits. The widely used process, also called “fracking,” involves injecting water, sand and chemicals deep underground to force the gas to the surface.

Environmental and anti-energy groups try to alarm the public over hydrofracturing by putting the words “chemicals” and “water” together in the same sentence, not really caring that the pressurized liquids used to fracture the gas-bearing strata are injected thousands of feet below the drinking water. As long as you can scare people.

You can see the effect in scores of news reports like this one from Pittsburgh radio station KDKA, in which a local resident complains his drinking water is tainted, but the state environmental agency finds no evidence.

“That’s exactly right,” Helen Humphreys, a spokesperson for the DEP, said. “The test results came back with results that are consistent with water in southwestern Pennsylvania.”

The DEP says it also has been unable to verify any contamination cases in the state caused by drilling, even though much of the public believes otherwise.

The Reid provisions resemble a bill sponsored by Sen. Robert Casey (D-PA), S. 1215, the Fracturing Responsibility and Awareness of Chemicals (FRAC) Act.

OK, but why not disclose the chemicals if there’s no risk to the public? Lee Fuller, head of the industry alliance, Energy In Depth, explained:
(continue reading…)

President Obama visited Youngstown, Ohio, in mid-May to promote the Administration’s economic policies, pointing to the stimulus bill’s success in encouraging investment and job creation. To illustrate his argument, he appeared at V&M Star, a manufacturing of steel tubular goods, embarking on a $650 million expansion.

In the President’s remarks, he hailed the new railroad spur that encouraged the company’s expansion.

So as a result of this investment, V&M Star’s parent company decided to invest $650 million of its own money — its own money — (applause) — to build a new one-million-square-foot mill right here in Youngstown, the largest industrial plant built in the valley since GM built its plant over in Lordstown in the 1960s.  Think about that — biggest investment since the 1960s — 50 years.  (Applause.)  So right here, in the heart of the old steel corridor, where some never thought we’d see an investment like this again, they’re placing a bet on American manufacturing and on this community.

And that bet is going to pay off for 400 construction jobs once they break ground this summer; 350 new manufacturing jobs once the mill comes online, which doubles the current workforce.

Infrastructure investment is critical to the manufacturing sector, of course. It was one of the key elements of a Milken Institute study, “Jobs for America: Investments and Policies for Economic Growth and Competitiveness,” sponsored by the National Association of Manufacturers.

But there better be an economic reason to justify the infrastructure, some underlying demand that inspires the investment. Unfortunately, President Obama made only one passing reference to the basic reason for V&M Star’s expansion — natural gas, that is, shale gas, that is, the Marcellus Shale, made accessible by hydrofracturing technology.

Groundbreaking ceremonies were held at V&M Star the end of June, and the local newspaper, The Vindicator, reported on the event. From “V&M Star’s $650m expansion gets rolling“:

Philippe Crouzet, chairman of the Vallourec Management Board, praised the private- and public-sector cooperation that made V&M’s expansion possible. [Vallourec is the French parent company.]

“Every aspect of our endeavor is coming together remarkably well,” Crouzet said. “There was an unprecedented collaboration between elected leaders, government professionals and the business community.”

The expansion will allow V&M Star to respond to the growing demands of its natural-gas customers in the Marcellus Shale, Crouzet said. The shale, a natural-gas formation the size of Greece located under Pennsylvania, New York, West Virginia and Ohio, could contain as much as 489 trillion cubic feet of recoverable gas.

“We are building the future in a market that has great opportunities,” Crouzet said. “V&M is well-positioned to serve as a bridge between this demand and supply.”

In case there was any doubt about the connection between economic activity, jobs and the Marcellus Shale, the American Petroleum Institute has released a new study that documents the value of natural gas. From the news release, “New Study Finds Natural Gas in Marcellus Shale Region Worth 280,000 Jobs, $6 Billion in Government Revenue“: (continue reading…)

From President Obama’s remarks at the V&M Star Plant, Youngstown, Ohio:

A year ago, we took significant action to jumpstart economic growth and job creation. That action included making investments in sectors with the greatest potential for private sector job growth — areas like clean energy and infrastructure.

And one of those investments is going towards revitalizing the site right next door, preparing it for new construction, and building a rail spur that connects to the Norfolk Southern line that runs through town. So as a result of this investment, V&M Star’s parent company decided to invest $650 million of its own money — its own money — (applause) — to build a new one-million-square-foot mill right here in Youngstown, the largest industrial plant built in the valley since GM built its plant over in Lordstown in the 1960s. Think about that — biggest investment since the 1960s — 50 years. (Applause.) So right here, in the heart of the old steel corridor, where some never thought we’d see an investment like this again, they’re placing a bet on American manufacturing and on this community.

And that bet is going to pay off for 400 construction jobs once they break ground this summer; 350 new manufacturing jobs once the mill comes online, which doubles the current workforce. And, as everybody here knows, every time a new factory or plant opens or expands in America, it doesn’t just employ the people who are working at the plant, everybody here, suddenly, they’ve got a little more money to go buy lunch somewhere or buy a computer for their kids or do something else, and so it becomes an economic lifeline for the whole community, capable of supporting hundreds or even thousands of jobs indirectly. And so that’s a success story that all of you are part of.

A nice summary of the economic impact of manufacturing.

Two points worth adding:

• V&M Star’s parent company to which the President alludes is Vallourec, a world leader in premium tubing goods based in Boulogne-Billancourt, France. From the company’s news release welcoming the President: “With over 2,500 people in 18 manufacturing facilities and service operations in the US, Canada and Mexico, Vallourec in North America primarily serves the local Oil & Gas market.” It wouldn’t have hurt for President Obama to say, “Thank you foreign investors!”

• V&M Star’s expansion will serve the natural gas boom in the Marcellus Shale region, primarily Pennsylvania, New York and West Virginia. Now and then the President issues a “shout out” to friends, allies and groups at his public events. We were hoping for, “Hydrofrac is in the house! A big shout out to my friends in the natural gas industry. Your are helping to bring economic recovery to the nation.”

The White House is promoting President Obama’s visit to the Youngstown, Ohio, manufacturer of steel tubing, V & M Ohio, as demonstrating the value of last year’s stimulus legislation. Fair enough, but V & M’s expansion would not be happening without the development of the Marcellus Shale’s natural gas, one of the great energy stories happening today.

Thanks to technological advances in hydraulic fracturing and directional drilling, and private-sector investment, the Marcellus Shale is producing wealth and jobs.

As The Cleveland Plain-Dealer reports, “President Obama’s destination: A Youngstown-area steel plant expanding with stimulus help“:

V&M is a subsidiary of Vallourec SA, a large European steel maker. The Plain Dealer described the expansion in February, saying the company plans to enter the growing market for small diameter steel tubes used to extract natural gas from shale deposits across the United States. To do that, the company is building a new factory next door to its existing facility in Youngstown that already employs about 500.

The new facility, which will be more than 1 million square-feet, will be above what used to be a mining operation.

Vallourec chose Youngtown, in part, because its in the middle of one of the largest shale formations in the world, called the Marcellus basin, and puts the company in close proximity to its potential customers. The deposit of brittle sedimentary rock, which contains a huge source of untapped natural gas, follows the path of the Appalachian mountains across New York, western Pennylvania, eastern Ohio, down to Maryland and West Virginia

The Marcellus Shale Coalition has a website with background, news and commentary on the development of this natural resources, including a report explaining hydraulic fracturing – the injection of high-pressure fluids into the shale formation to release the gas. On Wednesday, the coalition is holding a news conference in Duquesne, Pa.:

[Local] natural gas, steel manufacturing and transportation industry leaders will join elected officials to discuss to the positive and growing impact that responsible Marcellus Shale gas development is having on the region. Jointly hosted by the United States Steel Corporation (USS) and the Marcellus Shale Coalition (MSC), the event will focus on the extensive supply-chain network involved in producing this abundant, homegrown, clean-burning energy resource and its economic benefits throughout the region.

Good luck!

Shopfloor.org has posted often on the development of the Bakken Formation’s oil in North Dakota, Montana and the Prairie Provinces because it’s such a huge economic success story. The profitable development despite the depth (2 miles) of the shale formation testifies to the importance of new technology — advanced seismic exploration, hydrofracturing and directional drilling — and reaffirms the economic impact of domestic oil development.

The Wall Street Journal today reiterates these points with a well-done piece, “Oil Industry Booms — in North Dakota.” Excerpt:

The Bakken Shale deposit has been known and even tapped on occasion for decades. But technological improvements in the past two years have taken what was once a small, marginally profitable field and turned it into one of the fastest-growing oil-producing areas in the U.S.

The Bakken Shale had helped North Dakota oil production double in the past three years, surging to 80 million barrels in 2009—tiny relative to the more than seven billion barrels consumed by the U.S. every year, but enough to vault the state past Oklahoma and Louisiana to become the country’s fourth-biggest oil producer, after Texas, Alaska and California. If current projections hold, North Dakota’s oil production could pass Alaska’s by the end of the decade.

The Journal reports that the oil now pays off when prices hit $50 a barrel, down from $80.

Thanks largely to the oil boom, North Dakota’s economy has fought off the recession. The state’s unemployment rate in December was 4.3 percent.

Labor shortages are the inevitable downside. The Williston Area Development Foundation in northwestern North Dakota has a website set up to attract potential employees, RockintheBakken.com. There’s a jobs fair in Williston Thursday for people who hold commercial drivers licenses.

It’s trouble other states would love to have. The first step to get there: Regard domestic energy development as a boon, not a bane.

The Washington Examiner today takes note of the kneejerk reaction against development of the Marcellus Shale’s natural gas resources, made possible through hydrofracturing technology. From “Another enviro scare aimed at oil, gas“:

Continuing our look at this year’s State of the State addresses, we turn to West Virginia Gov. Joe Manchin, a Democrat. In his 2010 address on Wednesday, Jan. 13, he did not mention manufacturing and the only reference to industry was a passing reference to taxation of industrial property.

But this exercise — searching only for the terms “manufacturing” and the like — is limited. Manchin, a Democrat, certainly gave manufacturers prominent play in his speech, especially in the area of energy and coal:

We have more than 1,000 megawatts of wind power in service or in development – that’s enough to power more than 250,000 homes! And we have the third-largest wind capacity of any eastern state.

The world’s first successful carbon capture and sequestration project is at AEP’s Mountaineer Power Plant in Mason County, and an advanced pilot project is capturing CO2 at the Dow Chemical plant in South Charleston.

These pilot projects will lead the way for implementation of this technology at coal-fired power plants around the world.

Plans are moving ahead on a coal-to-liquids project in Mingo County that will use state-of-the-art cleaner coal technology. Through this technology, West Virginia coal will be our primary energy source as we make the transition to the fuels of the future.

Manchin also gave a plug to developing the natural gas resources in the Marcellus Shale.

Earlier posts on states of the state.

In his speech to the State Chamber of Oklahoma on Thursday, National Association of Manufacturers’ President John Engler discussed jobs creation through energy, infrastructure and exports. On the energy front, he discussed the astonishing expansion of domestic natural gas production (and potential production), thanks to technological advances in hydrofracturing.

Following are his prepared remarks from that section:

In Oklahoma, a proud tradition of supporting energy has helped keep your unemployment 3 percentage points below the national average.

You’re one of the states benefiting from development of shale gas, in this case the Woodford Shale. In Texas, there’s the Barnett Shale; in Arkansas, the Fayetteville Shale; in Louisiana the Haynesville Shale. Since 2000, gas from shale has grown from less than 1 percent of the nation’s production to about 10 percent.

Perhaps the most promising development is the Marcellus Shale underneath Pennsylvania and New York and West Virginia. Analysts say the Marcellus alone has enough gas to meet the nation’s needs for at least 14 years.

These natural gas deposits are close to northeastern population and manufacturing centers – they could be a real boon to consumers and industry in the area. But environmental groups have stirred up opposition, for example, in New York State, where there’s a pitched battle going on over natural gas drilling.

Opponents play on people’s fears of a technology that’s actually been in use for decades –- hydrofracturing. Thanks to massive R&D by energy companies, the technology has been improved, made even safer, and combined with horizontal drilling to open these shale deposits.

Oklahoma’s unemployment rate in October was 7 percent.

NBC Nightly News on Sunday ran a segment on the thousands available jobs in Bismarck and the rest of North Dakota, attracting out-of-state residents for jobs in health care, IT, energy, manufacturing and construction.

Energy has driven economic growth in the state, thanks to coal and, since earlier this decade, oil and gas development from the Bakken formation. An e-mailer — not me — expounded on NBC’s misdirected coverage today at National Review’s The Corner blog:

I think it would be important to point out to everyone, that ND’s job growth is fueled by the oil boom in that state from the Bakken shale formation. The video ignores that fact because it doesn’t fit the MSM’s sense of justice to grow our economy by doing something evil like developing our natural resources.

A hundred-year supply of natural gas has just been discovered in the last couple of years in the Marcellus Shale which underlies much of PA, NY and to a lesser extent other eastern states. If these states are open to the development of the natural gas like ND has been to the oil, they could enjoy the same economic situation. Unfortunately for the laid-off blue collar workers from those industrial states, the elitist environmental-minded politicians and ngo’s will likely block the potential economic boom.

To drill and produce the natural gas you need, drill rig hands, welders, electricians, road builders, general construction crews, engineers, petroleum geologists, environmental scientists (to do it cleanly), regulators (to make sure it is done cleanly), truck drivers, accountants, bankers and more. In addition to all those directly employed by an oil and gas boom, add all the support services those new people to an area need. Oil or gas booms can literally be like gold rushes of Western lore.

We don’t think the anti-energy forces will win in the end, but they’re definitely trying with the usual fear and falsehoods.

The Pittsburgh Post-Gazette covered the Marcellus Shale’s potential in a major Sunday business piece, “Natural gas locked in the Marcellus Shale has companies rushing to cash in on possibilities“:

According to a report released in July by Penn State’s College of Earth and Mineral Sciences, the Marcellus Shale helped create more than 29,000 new jobs in Pennsylvania in 2008. Of those, about 14,000 were directly related to Marcellus development. The remainder were created by what the study calls “indirect and induced impacts,” such as a restaurant near a drilling site hiring more staff because it is serving a larger lunchtime crowd.

The study predicts more than a decade of dramatic growth, with more than 48,000 new jobs this year, then another 98,000 in 2010.

By 2020, the study says, Marcellus development could add $13.5 billion to the state’s economy and create more than 176,000 new jobs in a single year.

NAM President John Engler is expected to talk about new natural gas developments in remarks tomorrow at the State Chamber of Oklahoma’s public affairs conference. Oklahoma is home to the Woodford Shale deposit.

The natural gas industry group, Energy in Depth, has lots more information on shale gas at its website, www.energyindepth.org.

UPDATE (2:45 p.m.): Now that you’re considering a move to Bismarck, take a look at Bismarck Tribune’s excellent website. Most popular stories:

It’s about 0 degrees there at the moment, but the big Midwestern storm passed it by.