Based on his recent visit to a similar facility in Pennsylvania, a Regional Chamber representative said a shale gas processing plant in Columbiana County likely will generate new jobs, but not as many as some people might expect.
Eric Planey, the chamber's vice president of international business attraction, said Chesapeake Energy Corp.'s planned building project likely will be "capital intensive," meaning it likely will cost a lot of money to build and equip, but that it won't necessarily require an outstanding number of workers to operate it.
"Without knowing the specific details of the (Chesapeake) facility, it's my understanding it's not something that's going to produce thousands of jobs like some people might think based on the cost of building it or its size," Planey said.
On Tuesday, Chesapeake Energy Corp., headquartered in Oklahoma City, announced on its website plans to build a $900 million facility in Columbiana County. The company did not provide a specific location and details were sketchy.
According to its website, the company plans to build the facility over the next five years with the majority of the capital invested in the first two years. Planey noted similar facilities have been built in sections, over time.
The company could draw some workers from the local labor force, but because it likely will be a specialized construction project, the work will be done by outside craftspeople with expertise in building the kind of plant Chesapeake is planning, he said.
Essentially, the facility is to be be designed to accept gas from wells being drilled in southern and eastern Ohio, process that gas and redistribute it to commercial markets.
A spokesman for the Structural Ironworkers Local 207 reached late Tuesday said he was remaining cautiously optimistic that the work would go to skilled trades unions.
"The first thing, it's great that it's coming. It's nice that they are spending money in this area to build something like that,'' said the local's business manager Rick Ellis.
He noted that the project will certainly create jobs, and said the skilled tradesmen will be waiting to hear if the work will be coming to them.
By comparison, the V&M Star construction project, also stemming from the shale play here, has brought 700 to 800 ironworkers to the area, including hundreds from the local and hundreds from out of town, including from other parts of the country, Ellis said.
Dennis Brubaker of the United Steel Workers remarked that he wouldn't be surprised if the new Chesapeake facility remains a work in progress over a period of time, just as V&M Star has.
"V&M Star went under construction a few years ago and it's still not finished," he said. "I have no idea how long a facility like this one in Columbiana will take to actually finish. It will be interesting to see how it develops and what goes on there."
The announcement posted on Chesapeake's website earlier in the day Tuesday was gaining momentum into the evening as national media was reporting on the story.
The move comes at a challenging time for natural gas companies struggling with too much supply that has cut natural gas prices significantly.
But the new plant is expected to also handle natural-gas liquids, which have been bringing higher prices.
According to the nation's second-largest producer of natural gas, it will partner with M3 Midstream LLC and EV Energy Partners LP (EVEP) to develop the complex, described as the largest of its kind in eastern Ohio. Chesapeake said the investment in the complex will be made over the next five years, with the majority of that spent in the first two years.
The natural gas giant has been under pressure from some shareholders and analysts to reduce spending and reduce debt. The company is responding with asset sales, but has said it does not want to pass up opportunities to buy shale properties before prices rise.
According to Market Watch and the Wall Street Journal, Frank Tsuru, president and CEO of Momentum, called the partnership with CMD and EVEP a "win-win situation for our companies and the citizens of Ohio.
"We will invest significant capital and technical resources to develop this project in a responsible manner, utilizing the highest industry standards," he said.
Last week, the Plain Dealer reported plans by NiSource Midstream Services to build a major 90-mile transmission pipeline through six eastern Ohio counties, including Columbiana. It would also pass south to Monroe County, through Carroll, Jefferson, Harrison and Belmont counties.
The pipeline will send gas and oil to a new processing plant capable of handling 200 million cubic feet of gas a day, according to the published report.