Energy sector adjusts to global oil plummet | TribLIVE

Mark Marmo is expecting $5 million in gas well equipment in a few months, and wants to hire 60 workers to operate it.He doesn’t expect the shale boom that feeds his Zelienople business to fizzle out.“What our customers are telling us is they’re going to stay active,” said Marmo, president of Deep Well Services, which contracts with operators to complete wells in the Utica and Marcellus shales. “You’re always going to get pressures, with companies looking for the right price. But we’re used to that stuff.”The global crash in oil prices that began this summer with increases in American shale production — and accelerated recently because of OPEC maneuvering — has sent chills through the energy sector. Some major companies, whose aggressive exploration of shale oil and gas reserves changed the face of energy production, are dialing back plans for 2015 while dealing with stock prices that tumbled.That could hurt field service companies and related manufacturers forced to slash prices, lay off employees or cut back drilling activity.The price crash benefited consumers through lower gasoline prices, though. And shale gas production in Pennsylvania, Ohio and West Virginia could benefit.Natural gas prices are low, especially in the northern reaches of the Marcellus, but more stable and insulated from oil, analysts say. Companies adjusted to the lower prices here. The shale below Pennsylvania is among the cheapest to exploit.“The operators that have figured out the economies of scale, and have been able to get very, very efficient, will be able to weather the storm,” said David Yoxtheimer, an associate at Penn State University’s Marcellus Center for Outreach and Research.

via Energy sector adjusts to global oil plummet | TribLIVE.

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