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Chesapeake plans $900M plant in county

To build gas processing complex near Hanoverton in 5-year project

March 14, 2012
Morning Journal News

LISBON - Chesapeake Energy Corp. announced Tuesday it plans to construct a shale gas processing complex as part of a $900 million, five-year investment in Columbiana County.

Although the news release issued by Chesapeake failed to state where the processing facility would be located, other sources have confirmed it will be built near Hanoverton.

The announcement comes 11 days after Chesapeake CEO Aubrey McClendon and his board of directors dined at the Spread Eagle Tavern in Hanoverton as part of a helicopter tour of company assets in Ohio, West Virginia and Pennsylvania. Chesapeake had more than 42,000 acres in the county under lease as of mid-December.

Spread Eagle owner David Johnson, whose family owns the Summitville Tile Co., met with McClendon and Chesapeake officials during their visit. "It's going to be a huge thing for this area because, as I said before, Columbiana County is at the epicenter" of the shale gas boom underway in the region, he said. "I know they told me (March 2) they are very serious about making a commitment to this area, and they expect it to be a long-term commitment."

County Commissioner Chairman Mike Halleck put it another way.

"This announcement is monumental. All of this is going to change the face of this county," he said.

The complex is to consist of gas gathering and compression facilities built and operated by Chesapeake subsidiary, Chesapeake Midstream Development. The site will also process gas, remove NGLs (natural gas liquids, such as ethane, propane, butane, pentanes, natural gasoline) from the shale gas, and serve as a loading and terminal facility, all of which is to be built and operated by the Houston-based M3 Midstream LLC, also known as Momentum.

EV Energy Partners LP, also based in Houston, is another partner in the county project.

"The state-of-the-art cryogenic processing facility will be located in Columbiana County and have an initial capacity of 600 million cubic feet per day. NGLs will be delivered to a central NGL hub complex in Harrison County that will feature an initial NGL storage capacity of 870,000 barrels and (NGL removal) capacity of 90,000 barrels per day, as as well as substantial rail-loading facility," according to the Chesapeake news release. This Harrison County facility is being constructed by MarkWest Energy Partners of Denver.

"This first question is how many jobs this will create. That'll be up to Chesapeake, but it's a $900 million project," Halleck said.

He said local officials have been working behind the scenes with area vocational schools to ensure residents have access to the necessary training to put themselves in a position to compete for the new jobs.

"Everyone's concerned we get people with the right skill sets," Halleck said. "For people looking for work, this is their opportunity."



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