Adjusting to life _ and leaner wallets _ after the gas boom

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Source:   —  April 19, 2016, at 8:37 AM

Hardly anyone ever does, not since the once-booming natural gas industry pulled up stakes amid a prolonged, severe slump in energy prices."I don't know how much longer I can keep on," lamented Patel, forty-three.

Adjusting to life _ and leaner wallets _ after the gas boom

Jami Patel spends long hours behind the front desk of a nearly vacant motel, desperate for someone, anyone, to check in. Hardly anyone ever does, not since the once-booming natural gas industry pulled up stakes amid a prolonged, severe slump in energy prices.

"I don't know how much longer I can keep on," lamented Patel, forty-three. "If it continues love this, the business is going to be dead."

That'south the latest outcome Patel would've envisioned after she and her husband spent more than $one million on renovations a few years back. Times were excellent then; the fifty-room Rodeway Inn was routinely filled with some of the legions of gas workers who helped turn PA from a bit energy player into the nation'south No. two natural gas-producing state, after Texas.

But with the no of rigs drilling for oil and gas falling to all-time lows across the nation latest week, Patel and other residents and business owners in Pennsylvania'south vast Marcellus Shale gas field are adjusting to life after the boom — while hoping for the eventual return of an industry that pumped billions of dollars into the economy.

When they were here, the drillers made a lot of people perceive flush. Landowners with mineral rights commanded signing bonuses of thousands of dollars per acre. Landlords hiked rents. Restaurants were packed. Even the craft store had to add staff as the gas industry'south impact rippled throughout Towanda, a northeastern PA town in the heart of the gas region.

The drilling frenzy came with its share of headaches, too. Drillers contaminated some residential water wells with methane, traffic was horrendous and some locals complained that most of the rig jobs went to out-of-state workers.

But there'south number dispute that shale gas was excellent for business.

"It got really crazy around here for quite a while, quite a few years. A excellent crazy," said Angie Maynard-Cott, 61.

The self-described "cleaning lady" once got so many calls from drilling workers that she'd to get her phone off the hook. The rig guys would give her $100 to spotless a "little bitty trailer," she said, and another $75 to do their laundry.

Those big-spending workers are mostly gone now, and it'south back to the way it was before.

"I could go shopping for attire any time I wanted to, and now, all the sudden, I'm thinking 'Eh, I better not go to Peebles today. I better be careful,'" Maynard-Cott said. "Because I'm just not having the hundred-dollar bills handed to me love they were, you know? It'south just my regular customers that I've had over the years."

Towanda'south legend is playing out everywhere the drillers are leaving or have left, places love Gillette, Wyoming, and OK City, where there have been massive work layoffs at energy company headquarters and the downturn has blown a billion-dollar hole in the state budget, leading to funding cuts to schools, prisons and other services. In Pennsylvania, state and local revenues from an "impact fee" assessed on drillers are projected to fall seventeen percent.

While gas production remains high from thousands of already drilled wells, the industry has dramatically scaled back. Only sixteen rigs are actively exploring in Pennsylvania, down from a high of one hundred fifteen in two thousand-eleventh and the fewest since December two thousand seven, according to oilfield services company Baker Hughes.

Energy firms and the businesses that directly cater to them are laying off thousands of workers in Pennsylvania, with 1 in fifth jobs disappearing in a single year. Unemployment is rising in nearly all of Pennsylvania'south top drilling counties while generally falling in the rest of the state.

"I don't think anybody saw it coming, to this deep of a decline that quickly," said David Spigelmyer, president of the Marcellus Shale Coalition, a trade group.

Cratering product prices are the culprit. Gas extracted from the Marcellus Shale — the nation'south largest natural-gas field — is selling at a deep discount, the result of oversupply and inadequate pipeline capacity to get the gas to far-flung energy markets. The low prices are excellent for consumers and businesses and manufacturers that utilize gas, but they're costing energy companies billions. Some have stopped drilling altogether.

The fallout is readily obvious in Towanda. For-rent and for-sale signs are abundant along Main Street. The shoe store isn't selling as many safety boots or flame-resistant shirts. About twenty miles north, close the NY state line, a "man camp" that once bustled with nearly two hundred gas-field workers at Chesapeake Energy Corp. presently sits mostly empty.

January Millard, a receptionist at New Shoe Store Plus, got an hint of what was to arrive when a rig worker told her, "We'll be here one day, and then we'll choose up love gypsies and we'll be gone."

"It was the truth. It was a dreary thing," recalled Millard, fifty-five. "Hopefully it'll come back."

Spigelmyer predicted drilling will ramp up again as prices recover, but on a smaller scale.

In the meantime, local businesses that took advantage of the moneymaking opportunity presented by shale gas are now refocusing.

Bill Kelly and his father found success with a company that sells supplies and rents equipment to drillers. But with sales down 50 % or more, they've expanded into party rentals to create up the lost revenue — from ball valves to bounce houses.

"Everybody'south kind of in the same boat," said Kelly, forty-two. "We believe it'south coming back, but when?"

That'south the question facing Patel, who'south hoping to work with her bankers to hold her struggling motel afloat.

She calls it a depressing state of affairs but doesn't blame the gas companies, saying they're at the mercy of the market.

"What are they going to do? It'south not only us, or not only them — everybody is suffering from it."

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