Reflections from Marcellus Utica Midstream Conference

Two days at the #MUMConf, five days of President Trump, 26 days into 2017, 1,000+ O&G advocates and industry colleagues and one NPR reporter... 

The buzz of excitement was hard to ignore.

Taking a breath from the whirlwind of conference activities, I thought I’d share a few of my personal takeaways from the industry science-fair and executive presentations throughout this week’s event.

CEO of Williams Cos, Alan Armstrong kicked off the conference with a phenomenal presentation highlighting Transco’s dedication to infrastructure expansion and their commitment to double capacity by 2018. Alan’s research reveals that a lack of pipeline infrastructure in the Marcellus region will negatively impact local communities, which seeps through to the rest of the nation. Those affected the most by inadequate oil and gas pipeline transportation are our low-income citizens. Alan cited the statistic that, in America,

“The Lowest 20% of Income Earners Spend 10% of Income on Electricity Alone.”

NYC is most interesting, as NY State has shut down pipeline construction, fracking and nearly anything to do with natural gas (arguably the most clean, sustainable, efficient energy we have access to today). However, the reality is, gas is the reason behind a cleaner environment. Also per Alan’s research,

“NYC is the cleanest it’s ever been in 50 years and we have Natural Gas to thank for that.”

Unfortunately, those who oppose expanding our pipeline infrastructure don’t fully understand the bigger picture. Halting all fracking and pipeline construction, prolongs NYC’s use of carbon fuels, which simultaneously causes a substantial increase in the cost of living, making life that much more difficult for impoverished residents.

After a poll of a small subset of the 1000+ #MUMconf attendees, many of them touted Willbros Group’s Harry New, President of Oil & Gas segment to have had THE BEST, most interesting presentation of the morning. (Yes, I’m biased.) The best part, in my perfectly partisan opinion, was having a contractor’s perspective at the Hart Energy event. It’s was a rare opportunity to showcase the contractor point of view and dedication to supporting this industry with boots on the ground. The financial impact of the economic downturn and project delays in many cases found that we were the hardest hit stakeholders.

The business accommodations required to adjust to a market where in 6 months the price of our product plummeted 50% required endurance, incredible business acumen and much loss. The ability to stretch and shrink with market demand is mandatory, otherwise a contractor risks bankruptcy. Last year we lost the oldest pipeline construction contractor in the US for precisely this reason, leaving Willbros to fill that role with 108 years in business.

On the upside, in the near future the Marcellus region alone is expecting to kick off a staggering number of projects. The top 13 major infrastructure developments will drive 3,339 miles of pipeline, will cost $28B in capital expenditures and…according to our calculations will require 84 spreads. It will create MAJOR capacity strain from contractors who have consolidated, left the market altogether and shut their doors, or severely reduced talent and headcount in order to weather the storm.

The big takeaway from the conference left me with great encouragement, excitement and hope in the coming year. Jobs catalyzed by the construction of necessary infrastructure and greater use of clean energy in the form of gas are important developments stemming from the Marcellus. It may not be ‘a recovery’, but we can all appreciate that 2016 is behind us and we have nowhere to go but up.

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This blog is mine. Thoughts and opinions conveyed on this site are my own. Concepts published are not approved in advance by Willbros and does not reflect the views of anyone but me. All feedback and comments are welcome.

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Courtney McShane is the Director of Business Development at Willbros, a pioneer in pipeline construction with 109 years of history and services that support both power and oil & gas industries. For more information, see our website www.willbros.com. She can be reached at courtney.mcshane@willbros.com.