November 14, 2011

Manchin Chairs Senate Energy Committee Field Hearing on Marcellus Shale’s Job Creation Potential

Opening remarks from hearing, held in Charleston, are included below

Charleston, W.Va.-- Senator Joe Manchin (D-W.Va.) today chaired his first-ever field hearing of the Senate Energy and Natural Resources Committee on Marcellus Shale development and production. The hearing, which will focus on Marcellus’ tremendous job creation potential and development challenges, was held in Charleston. 

His opening remarks, as prepared for delivery, are included below. 

“I’d like to call this hearing to order.  

“I’d like to welcome the members of Congress who have joined us today – my colleagues Congressman Rahall, Congresswoman Capito, and Congressman McKinley. I am glad you are here to add your voices to our discussion today. 

“I would also like to thank all of the distinguished witnesses who have come to speak on the important issue of Marcellus Shale gas development in West Virginia. 

“And, thank you to all of you who have a stake in this issue from business folks, our local community officials, and constituents who have made time to be here today. 

“Today’s hearing is an extension of the good work the U.S. Senate Energy Committee has been doing on shale gas development. The purpose of the hearing is to examine Marcellus Shale Gas development and production in West Virginia. My friend Chairman Jeff Bingaman has held two natural gas hearings this year, and so this is the third hearing of the full committee on an issue that is uniquely important to our state and region. 

“I’d like to thank Chairman Bingaman and Ranking Member Lisa Murkowski for allowing me to bring the work of the U.S. Senate Energy Committee to West Virginia. 

“I cannot think of a more appropriate topic for my first field hearing. We all know that Marcellus Shale could truly be a game-changer for our great state. We are literally sitting on top of tremendous potential with the Marcellus Shale, and we need to work together to chart a path forward in a safe and responsible way that allows us to produce energy right here in America and create good-paying jobs for hard-working Americans. Of course, we also need to do all that we can to make sure that West Virginians are getting the jobs here in West Virginia – because the people of our state should benefit from the natural resources we have. West Virginians are the hardest workers in the world, and I’ve always said that we’re not looking for a handout, we’re looking for a work permit. 

“We’ve gathered experts here today to discuss how the development of the Marcellus Shale can help us rebuild America. I know there are a whole host of issues of great concern to folks around the state – like how we can use all of our abundant natural resources like coal, timber and natural gas in a balanced way that does not endanger the health of our land and water, and whether industry is treating residents fairly. 

“To address these concerns, I truly believe that we need a regulatory system in place that is really driven by the states, with the federal government acting as a partner – to effectively extract the natural gas and attract the billion dollar ethane cracker plants for natural gas production and the jobs they would bring to West Virginia. I know our state legislators are working very diligently on this as we speak. 

“That is what we need to explore today: is West Virginia ready to assume the primary regulatory role as we go forward? Are we prepared with the regulatory expertise and the resources to develop the Marcellus safely and responsibly? Do we have enough inspectors? Is our infrastructure able to bear the burden of new development? And how can the federal government and the EPA act as our partner – not our adversary – in all of this? 

“Let me remind all of you that oil and natural gas exploration are not new to West Virginia – in fact, West Virginia is home to the very beginnings of petroleum exploration in the United States. 

“Oil and gas production in West Virginia actually began as an outgrowth of the salt industry in the 1800s. At that time, oil and gas had no real significance in our state, but salt makers would frequently hit oil and gas in their drilling. So much oil was diverted to the Kanawha River by salt manufacturers that it was known as “Old Greasy” to the boatman. 

“It didn’t take long for some industrious West Virginians – namely the Rathbone brothers – to find the value in these salt byproducts. These brothers began exploration in what became known as the Burning Springs oilfield in the Great Kanawha Valley Region. It was named this way because you could get a pretty good flame by throwing a lighted candle into the gas that escaped this site. 

“From these early beginnings in around 1859, the oil industry grew to peak production of 16 million barrels in 1900.  Natural gas took off from there and West Virginia led the country in natural gas production until 1917. Natural gas output then went on the decline and picked back up in about 1970. 

“There have been booms and busts throughout the last hundred years in West Virginia. It’s estimated that there are more than 150,000 existing oil and gas wells in our state, whether they are still producing or not.  

“But that doesn’t compare to the potential volumes that could be produced here in West Virginia from the Marcellus Shale. 

“New technology – like hydraulic fracturing and horizontal drilling – are really giving us the tools to extract this vital resource. 

“Since 2005, drilling in West Virginia has really taken off – in 2009 we had about 51,000 producing wells in our little state. That number represents slightly more than 10 percent of all the producing wells in the country. That’s a lot of wells, and we are just getting started. New permits are being issued all the time – 1,500 new permits in 2010 alone. 

“There is remarkable potential for new jobs from these drilling activities. 

“A recent report by the National Energy Technology Laboratory projects that developing shale gas in West Virginia would result in 17,000 additional jobs, $870 million generated from state and local taxes, and $1.3 billion dollars in direct payments to households through royalties and industry payroll. 

“State officials here in West Virginia have estimated that we could expect more than 2,300 direct jobs from the construction of just one cracker plant to convert ethane, a by-product of Marcellus drilling, into ethylene – a chemical that is used as stock feed in the chemical industry. 

“Businesses’ investment in one plant would be at least $1.5 to $2 billion dollars. That’s a serious investment. 

“And the folks at the American Chemical Council have even more detailed projections: that about $3.2 billion dollars would also be invested in the downstream chemical facilities that would make products like dyes, paints, coatings and plastics. 

“That investment would generate $7 billion dollars in additional chemical industry output in West Virginia. The council also estimates that about 12,000 jobs would be created in the chemical industry and throughout the supply chain in West Virginia, moving us from the 23rd largest chemical producing state to the 13th largest in the country. 

“The potential of Marcellus is truly remarkable. From an energy-development standpoint, we are on the cusp of something that could help us reduce our dangerous dependence on foreign oil that threatens both our national security and our economic security. It’s so important that we develop our resources here at home, rather than continuing to rely on countries that don’t like us very much and wish to do us harm. 

“We need an energy portfolio in this country that uses everything, and I repeat, everything, – natural gas and oil, coal, wind, solar, hydropower, geothermal – you name it, we need it. Marcellus has a large role to play in that.  

“But no matter how we move forward, we have to do it right, in a way that balances our environment with our economy. That creates jobs without damaging the health of our lands and our waters and most importantly, our children. And that allows the states to take the lead on regulating this tremendous resource. 

“That’s what we are looking at today. 

“With that in mind, I’d like to give my Congressional colleagues a few minutes each to present some opening statements.  I ask that you keep your remarks to three minutes and you are welcome to submit more lengthy remarks to the record.”