Amid trying times for industry, shale-gas conference returns

After shifting its annual conference to Western Pennsylvania last year, the shale-gas industry returns to Philadelphia on Wednesday for a two-day gathering amid an economic climate substantially subdued from the industry's early go-go years.

The Shale Insight 2015 conference at the Convention Center, sponsored by the Marcellus Shale Coalition, is placing an emphasis on the industry's ties to the Philadelphia region as a potential energy hub, if the pipelines to deliver shale-gas products can be built.

"We're trying to shed a light on the skin in the game that Philadelphia has with shale," said David J. Spigelmyer, the coalition's president.

The industry is in a slump, partly because of its own success. Pennsylvania is now the nation's second-largest gas-producing state, but oversupply and lack of pipeline infrastructure have forced wholesale prices down to unprofitable levels. Reduced gas prices mean smaller royalty checks for owners of mineral rights, including thousands of Pennsylvania landowners.

The 69 drill rigs operating in the state are half the peak level of January 2012, and gas production began trailing off slightly after hitting an all-time record in July, according to the U.S. Energy Information Administration.

"We witnessed about $10 billion in capital investment walk from Pennsylvania in 2015, and we're likely to see that much walk in 2016 due to the ongoing price tightness," said Spigelmyer.

Reduced drilling activity coincides with an ongoing stalemate in the Pennsylvania legislature over Gov. Wolf's proposal to enact a tax on shale production to fund education.

About 1,100 to 1,300 people are expected to attend the conference, down from the 1,600 who attended the 2013 event in Philadelphia. The coalition, after having its first three confabs here, last year began alternating with Pittsburgh.

Anti-drilling activists, who organized large demonstrations the first two years of the conference, plan to make an appearance Wednesday. They object to the energy-hub concept, which involves an increase in pipeline construction and energy-intensive industry.

"Each time they convene here, we protest the shale-gas and oil-industry conference, successfully raising awareness about the impacts of fracking, exposing industry lies, and showing leaders that we expect them to work for public good, not private profit," Iris Bloom, of the group Protecting Our Waters, wrote in a blog post last week.

The shale-gas industry has typically received less support in Southeastern Pennsylvania than in western and northern counties, where most drilling has taken place.

The coalition has enlisted support from area labor unions, whose members are building pipelines or constructing the Sunoco Logistics terminal in Marcus Hook, where liquid fuel such as ethane will be stored and loaded onto ships.