Utica Shale Growth Has Potential to Generate Pipeline, Jobs

The oil and gas energy industry relies on pipelines to deliver the fruits of its labor to market. Pipelines require manufactured steel and people to place and weld them. If the Utica Shale proves to be as bountiful as hoped, Ohio will need a lot of them.

This will benefit Ohio consumers and businesses by virtue of cheaper transportation costs for natural gas. There are no public plans for any additional large transmission pipelines, similar to the Rockies Express in 2009, through Ohio, according to the Public Utilities Commission of Ohio and the U.S. Federal Energy Regulatory Commission. There is a proposed pipeline for ethane, a natural gas liquid found in shale, called the Appalachia-to-Texas Express Pipeline.

However, there are 236 approved Utica Shale wells, capable of producing massive amounts of gas, liquids and oil. One Chesapeake Energy well pumped 725 times as much gas in 2011 as the average producing well in the state.

Experts say not to expect more high-capacity interstate lines, but instead miles of gathering lines that will feed into Ohio's existing network. Transmission pipelines will not keep pace with drilling, which is expected to gather steam in the next year or two.

"That would be unlikely," said Charles Mason, an economics professor at the University of Wyoming. "You can drill a well and get it going pretty quickly. You can't get a pipeline up and running that fast."

The largest refiner of oil in the Midwest, Marathon has a contract for 1,000 barrels per day, and all of it is trucked in, company spokesman Shane Pochard said.

"We're in the pretty early stages of (the Utica Shale) coming online, so the fastest and quickest way to begin running it is by truck," Pochard said. "Ideally, as the play grows and matures, pipe would be preferred. It's the most efficient way to get oil into the refinery."