Inside
the
Industry
Energy & Manufacturing
COMPILED BY SAMANTHA CART
West Virginia’s energy and manufacturing industries have
enjoyed a banner year of optimism and renewal. New industry-
friendly federal legislation combined with the removal of
many stringent regulations have allowed these industries to
get back to work, increasing productivity and creating much-
needed jobs in the Mountain State.
However, even with a renewed sense of hope, there is still
a long way to go. West Virginia continues to face many of the
same problems, including unemployment, stagnant natural
gas prices and the lack of a qualified workforce for its skill-
specific industry jobs. Meanwhile, energy and manufacturing
companies continue to fight to maintain the balance between
restoring what was and focusing on the future as well as
addressing industrialization and environmentalism. Major
Supply & Demand
The Importance of Midstream Development
By Anne Blankenship
West Virginia Oil and Natural Gas Association
West Virginia is poised for a great future, thanks in part to
the benefits of the oil and natural gas industry. Exponential
increases in natural gas production over the past decade have
provided the state with billions of dollars in severance and
property taxes, which are allocated to its counties and commu-
nities. The industry has provided nearly 71,000 direct and indi-
rect jobs in the Mountain State, and now that mineral efficiency
laws have been passed by the Legislature, those jobs and tax re-
ceipts are expected to increase substantially. Production is also
expected to increase by nearly 50 percent in the Marcellus
and Utica shales in the coming years.
Production is only part of the story, though. Once the nat-
ural gas is extracted from the ground, it must be made fit for
consumption by being processed, fractionated, stored and/or
marketed—all functions of the midstream segment of the oil
and natural gas industry. Without the midstream portion, the
gas would not be consumable or go anywhere.
issues such as a lack of midstream production, natural gas
infrastructure, rising energy costs and overregulation continue
to impede progress.
For West Virginia Executive’s annual energy and manufac-
turing issue, we spoke with the executive directors of the West
Virginia Oil and Natural Gas Association and Independent
Oil and Gas Association of West Virginia, Inc. and the pres-
idents of the West Virginia Manufacturers Association and
West Virginia Coal Association about a specific issue each is
facing. Here they offer an explanation of their challenges and
advice on how the Mountain State can overcome these issues
and continue on a path of hope and revitalization.
Midstream operations gather and transport natural gas to
customers, whether they be natural gas distribution companies,
industrial customers or power generation facilities. In addition,
during the midstream process, natural gas is separated from its
gas and liquid phases. Natural gas liquids (NGLs), including
ethane, are the building blocks for our chemical manufacturing
facilities and are used to make the plastic products we use every
day. Not only does this highlight the importance of natural
gas in our lives, but it means we can produce and use it right
here in West Virginia.
Historically, West Virginia has been a huge manufacturing
industry hub, and we are seeing a resurgence, due in part to
the proximity to natural gas. Now that we can access more
natural gas and process it here through midstream operations,
the potential for growth in the manufacturing industry is
enormous. Part of the path to reaching that potential includes
the development of a storage hub in our region for ethane and
other NGLs, which would create a market for the product
and allow proximity to downstream users right here in West
Virginia. The midstream segment’s vital role and investments
made in the Mountain State will ensure that all of the natural
gas we produce is market ready and fit for consumption in
order to reach our long-term potential.
WWW.WVEXECUTIVE.COM
SPRING 2018
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