Economic impact of oil and gas boom a positive for eastern Ohio
WALNUT CREEK – An Ohio State economics professor believes Ohio should use the economic windfall from the oil and gas boom to create a legacy of prosperity for the region.
“We’ve got to hold our policy makers accountable for using these windfalls responsibly,” Matthew Roberts told those in attendance Friday at the Eastern Ohio Development Alliance annual meeting at the Carlisle Inn in Walnut Creek.
In decades past, southern Ohio was dependent on the coal and steel industries for prosperity, but those industries eventually fell into a state of disrepair, he said. “We need to be thinking about that, and policy makers need to be thinking about that.”
State and local leaders should be focused on what will happen to the economy in 20 or 30 years, he said.
“The goal should be that in 20 years, there will be no need for the Eastern Ohio Development Alliance,” Roberts said. Officials should make use of eastern Ohio’s oil and gas industry to turn this area into “an irresistible place” to do business.
The current state of the world has increased the demand for energy, he said.
“We right now live in the most peaceful and prosperous time we have ever known,” Roberts said.
To back up that statement, he said that the number of people in the world living on $1 a day or less has dropped by 80 percent since 1970.
“That’s an amazing turnaround,” he said.
And while there are wars being waged all over the world, they are claiming fewer lives. Just 1,500 Americans lost their lives during the war in Afghanistan, he said, while 13,000 airmen died during the Normandy invasion in World War II.
The reason this matters is because “the prosperity and standard of living that people aspire to requires energy,” Roberts said. The global increase in wealth and prosperity is what drives the price of oil and gas.
Shawn Bennett, executive vice president of the Ohio Oil and Gas Association, was the other featured speaker at the annual meeting. He talked about the “good, bad and ugly” of the oil and gas industry in eastern Ohio.
Oil prices have dropped 50 percent in the past four months and natural gas prices have dropped by 60 percent, he said.
That has taken its toll on the industry. The number of rigs operating in Ohio has dropped from 59 to 24, and many energy companies have cut their budgets, he said.
There are only two rigs operating in Carroll County, one in Guernsey County and two in Noble County, Bennett said. Energy companies are focused on Harrison, Belmont and Monroe counties. Six rigs are in operation in each of those counties.
Ohio has the cheapest natural gas in the United States, and the state needs to use that to attract manufacturers that use that product, he said.
The recent announcement that a multi-billion dollar ethane “cracker” plant is being considered for Belmont County is part of that process, he said. The plant will attract the plastics and petrochemical industries to eastern Ohio.
“Those are industries that will produce a lot of jobs,” he said.
Bennett predicts that oil and natural gas prices eventually will rise again.
“It will come back. We just have to ride the wave,” he said.
The Eastern Ohio Development Alliance is a nonprofit organization that serves 16 counties in eastern and southern Ohio — Tuscarawas, Harrison, Carroll, Holmes, Coshocton, Athens, Belmont, Columbiana, Guernsey, Jefferson, Monroe, Morgan, Muskingum, Noble, Perry and Washington. It was formed in 1990 to promote economic growth in the region.
“Excellence” awards were presented to several area organizations by the Eastern Ohio Development Alliance:
- Large manufacturer – Allied Machine and Engineering, Dover
- Technology – Tolloty Technology Incubator, New Philadelphia
- Emerging business – McWane Poles, a division of McWane Inc., Coshocton
- Tourism – Coshocton Visitors Bureau
- Small business – Basic Systems Inc., Cambridge
Source: Eastern Ohio Development Alliance
Two organizations were recipients of the Don Myers Legacy Fund:
- Journey’s End Ministry, Newcomerstown
- Backpack 5000, First Presbyterian Church, Cambridge
Source: Eastern Ohio Development Alliance
From Times Reporter.com | April 24, 2015