The Marcellus Shale: The Real Deal for the Construction Industry?



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The Marcellus Shale: Is it the Real Deal for the Construction Industry?

From Williamsport to Waynesburg, Pennsylvania, through the Northern Panhandle of West Virginia and continuing to Charleston, the area?s rural roads and one realizes that a mini industrial revolution is occurring throughout our tri-state region. Small town hotels and restaurants are overflowing with the commerce that has come with the Marcellus Shale activity. But what does this activity mean for the construction industry? While the activity is easy to observe, until recently, the actual economic impacts have not been quantified.

Providing valuable insights on these issues, researchers at the West Virginia University College of Business and Economics have just published a study, funded by the West Virginia Oil and Natural Gas Association, entitled The Economic Impact of the Natural Gas Industry and the Marcellus Shale Development in West Virginia in 2009 (the ?Study?). In the Study, WVU researchers analyze a variety of issues, including the economic impact and forecasts, on Marcellus activity on the construction industry, among others. The results are striking. The Study found that in 2009 the oil and natural gas industry ?directly employed? approximately 9,900 individuals representing over $550 million in wages. Indirect employment totals some 24,000 jobs. In this calculus, over 10 separate industries were represented with the construction industry accounting for 1,000 direct jobs which placed it 3rd behind the mining, transportation and warehousing industries. All told, the Study concluded that ?total employment, employee compensation, and total value added impacts of the Marcellus Shale development on the West Virginia economy in 2009 had the most effect on the mining and construction industries.?

Aside from the Study forecast, there is good reason to suspect that this trend will continue into the future with various energy companies announcing projects that will continue to positively impact the construction industry. For example, Dominion Transmission recently announced plans to construct a large gas processing facility at Natrium in Marshall County. Further, the abundant, local supply of gas should act as a catalyst for gas-consuming industries to locate within the region. We would invite you to review the work of the WVU researchers and draw your own conclusions as you consider the prospects of construction-related activities in the Marcellus Shale region.  A copy of the Study may be found by clicking here