Youngstown Business Journal - Johnson, Ryan Meet with BP Execs to Talk Shale

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By George Nelson

BP America is optimistic about the Utica shale play's potential, but the energy giant is at least a year -- or two -- away from fully understanding the potential of the oil and gas leases the company holds here, says Tim Harrington, regional president for BP's North America gas.

"We're sort of on the second hole of an 18-hole kind of round," he remarked "We've secured a leasehold so over the next two years we'll be putting a few wells in the ground to understand the produce-abilty of that and what the resource base looks like.

"Right now we are in our exploratory phase so were waiting to see what the rocks have to tell us," added Curtis Thomas, director of government and public affairs for BP. "Everything we know so far makes this a very promising play, but we won't know at what level we'll be able to operate -- or if we're able to make this a material business -- until we have data resource from the rocks. But we're very hopeful."

BP played host Friday to U.S. Reps. Tim Ryan and Bill Johnson at its Ohio headquarters in Youngstown Commerce Park.

The visit was an opportunity for Ryan and Johnson, who toured the Ohio headquarters and met privately with BP officials, to learn about the company's plans, processes and practices, and for the BP officials to learn about their concerns, Thomas said.

Ryan and Johnson want to continue to learn about an industry that is newer to the Mahoning Valley, "especially on the scale that it's going to be," Ryan said. "There's a ton of opportunities here and the closer we can work in conjunction with a company, the better off we're all going to be."

"You're talking about an opportunity here to bring Appalachia Ohio and the Mahoning Valley into a period of prosperity that has not been seen since the steel mills came here years and years ago," added Johnson. "BP is just one of many companies in here but they've got a formula that appears to be working."

Both Ryan, D-13 Ohio, and Johnson, R-6 Ohio, were among more than 100 members of Congress who sighed a letter Thursday to Energy Secretary Steven Chu urging him to expand domestic exports of liquefied natural gas.

"America has an opportunity here to be a leader in natural gas exports. Other counties in other regions of the world that are already doing this and we have a wealth of this resource," Johnson said. "If we're talking about America being able to compete on a global scale, why shouldn't America be able to compete in this area as well?"

While the letter was not related to Friday's meeting at BP's Ohio office, "We'd love to see the market for natural gas increase and we'd love to have this area be one of the key areas where there is a plethora of natural gas and we hope that actually will come into play," said BP's Thomas.

The BP official could not say whether might mean higher domestic natural gas prices. "Right now we're just concentrating on the Utica shale play in this office. That's our main focus, to make sure that this is a viable market for us," he said.

"There's a natural supply and demand for every product that's out there, and market economies work," Harrington remarked.

"Sometimes when the price is so low, people don't pull [oil and gas] out of the ground," Ryan said. "We can either import oil or we can export natural gas. I think most people would say let's export and create the jobs here."

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