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Canfield attorney speaks on future of oil production

April 10, 2014
By J.T. Whitehouse , The Town Crier

Tri-County Networking, a group of area business owners and leaders, meets the first Thursday of each month at Ala-Cart Catering on U.S. 62 in Canfield. Each month a special guest speaker is brought in to address items of interest to the business community. Last week's speaker was Nils Johnson from the law firm Johnson and Johnson of Canfield. He spoke on the oil and gas industry and how it affects the Mahoning Valley.

Johnson began his talk on world oil production. He said oil fields were discovered in the United States in the 1940s and 50s and peaked around 2005. While the oil consumption flat-lined for most of the world, China has gone from very little to a consumption almost equal to the U.S. in just the last six years.

''Right now the U.S. consumes seven billion gallons per day,'' he said. ''And 60 percent of that is produced right here.''

He said the Marcellus Shale is the big success story, going from zero production to meeting 15 percent of the nation's supply.

''In Ohio, we are seeing a $6 billion investment in the Shale industry,'' he said.

As for Mahoning County, Johnson said he believes only half of the area will be developed. The hot spots are Canfield, Boardman, and Springfield.

''Those will stay attractive to drillers,'' he said.

The northern section of the county is a different story. He said a lot of five year leases are coming to an end and many won't be renewed. Part of the problem involves the cost of drilling a well. He said under present prices for gas, some areas would not warrant the cost of drilling. As prices increase, those areas may be looked at.

''As gas prices increase, it will make more areas profitable to drill,'' Johnson said.

As for green technology, Johnson said solar, wind and hydo is not the solution. He referred to the ''green death'' in Germany as a model.

''The green movement made the cost of a kilowatt hour in Germany rise to $.40 compared to $.07 in the U.S.,'' he said.

As for fracking, he said there are 5,000 wells in Canfield and every one has been fracked. He said fracking began in 1948 and is not a new procedure.

 
 

 

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