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Marcellus Shale Job Program Turns Unskilled Into Shale Workers

By On May 25, 2012 1:10 pm


–Workforce-development program, ShaleNET, is funded by a $4.6 million federal grant

–Residents in Pennsylvania, neighboring states are trained to compete for Marcellus Shale jobs

–Average annual income for a worker handling pipelines, maintaining a rig could be $100,000

By Isabel Ordonez
Of DOW JONES NEWSWIRES

PITTSBURGH (Dow Jones)–Professor Byron Kohut helps hundreds of low-income adults land coveted jobs in the booming shale-gas industry in Pennsylvania. But only the tough need apply, he said.

“If they are not physically capable of working outside, in bad weather, dangerous conditions, I scare them out of drilling,” said Kohut, who coordinates a natural-gas job-training course at Westmoreland County Community College, about 40 miles southwest of Pittsburgh. “It’s not easy work,” Kohut said, adding that people with backgrounds in agriculture, construction and mechanics have a better shot at getting in.

The community college’s course, part of a workforce-development program funded by a $4.6 million federal grant, prepares residents in Pennsylvania and neighboring states to compete for the torrent of jobs being generated by natural-gas companies tapping the prolific Marcellus Shale. The multi-state program, called ShaleNET, is trying to fix a mismatch between the rising number of jobs emerging with the shale-gas business in Pennsylvania, Ohio, West Virginia and New York, and the many unemployed, or low-paid, workers who can’t be hired by the shale industry due to their lack of basic skills.

Labor demand in the Marcellus Shale, a deeply buried layer of tight rock containing vast amounts of natural gas, has continued to grow despite recent rock-bottom prices for the commodity, in part because the area’s highly productive wells, and their proximity to huge markets in the Northeast, allow drilling there to remain profitable.

Almost half of the 400 people needed to drill a single well do jobs that don’t require four-year college degrees, including general labor, heavy-equipment operators, and truck drivers. In about four weeks of training, the ShareNET program turns young farmers, construction workers, veterans and carpenters, among others, into certified gas-field workers who know the basics about drilling and controlling a well.

The program’s standards are high because, otherwise, students wouldn’t be able to compete with more-experienced workers coming from Texas and Louisiana who have a long relationship with the energy industry, said Laura Fisher, senior vice president at Allegheny Conference on Community Development, a non-profit organization that created ShaleNET. The non-profit entity has a long list of applicants, but there are only a few dozen spots available.

While the shale-gas industry has already helped the Pittsburgh region’s March unemployment rate of 7.1% to best the nationwide rate of 8.4%, many of the higher-paid occupations–such as tool pushers or pump operators–were going to the newcomers from out of state, Fisher said. Many companies preferred the out-of-state workers because they already knew the basics about safety and were accustomed to working the 12-hour-per-day shifts that are common in the drilling industry, Fisher said.

The ShaleNET program, which has graduated 250 students, along with new industry-community partnerships, is helping to increase the rate of local hires. About 180 students have been hired by 56 companies. The program has also helped about 1,000 people to find jobs in the shale industry through its website or through various partnership it has with federal job-placement agencies, Kohut said. In addition, 13 community colleges, one university and six vocational high schools in the region are starting the same training program.

Labor demand in the Marcellus Shale area is expected to continue to surge in coming years, said Sue Mukherjee, director of the Pennsylvania Department of Labor and Industry’s Center for Workforce Information and Analysis.

For instance, jobs for drill operators are expected to grow 84.9% to 2,674 this year from 1,446 in 2010. This compares to 2.6% estimated growth for all type of jobs state-wide in the same period, Mukherjee said.

Mark Madonna, a 24-year-old who until last year worked in construction, was hired in February by Falcon Drilling, a service provider based in Indiana, Pa. He is now a rig ground worker.

Madonna, a single father who didn’t attend college, said the training provided by Westmoreland County Community College was “extremely vital” in his getting his new job.

He tried for nine months to apply directly to companies he knew were hiring, but nobody took him seriously until he was admitted to the course. Madonna, like most of his classmates, received a job offer from Falcon Drilling the day after he graduated. “I love physical labor, I love machinery and I love to be working outdoors,” Madonna said. “I’m not afraid to work.”

His new job pays $12.56 per hour, about the same as he was making when he was building counter tops and cabinets. But the big difference, he said, is that his take-home pay will jump, thanks to overtime, and, in a few months, can almost triple if he gets promoted.

Kohut, who has a doctorate in education, said many of his former students are making significantly more money than he does. The average annual income of a roughneck–a member of the oil rig in charge of handling pipelines and maintaining the rig–is $100,000. That includes overtime, daily stipends and room and board.

“It’s a dangerous job, but it pays well,” Kohut said.

From the Wall Street Journal

http://online.wsj.com/article/BT-CO-20120525-709511.html

-By Isabel Ordonez, Dow Jones Newswires; 713-314-6090; isabel.ordonez@dowjones.com