MN Cos. Tap Into Gas Boom In NE U.S.
At least two Minnesota companies have recently expanded their operations into Pennsylvania to become more active in the Marcellus region’s natural gas industry.
The Marcellus region consists of fossil fuel-rich shales (fine-grained sedimentary rock) and extends into West Virginia, Ohio, New York, Pennsylvania, and Maryland. In the last decade, engineers have begun devising ways to capture the natural gas within the shales through processes such as hydraulic fracking—drilling into the shale layers and pumping pressurized water to push the natural gas out and through the drill pipe. While nationally sourced natural gas benefits the U.S. economy, it also poses a series of environmental, property rights, compliance, and royalties concerns.
Natural Resource Group, Inc., (NRG)—a Minneapolis-based energy consulting firm that operates 10 U.S. offices—recently opened a facility in Pittsburgh to lend its management, permitting, inspection, and compliance services to clients in the Marcellus region. NRG already participates in several shale plays, including in the Haynesville, Utica, and Upper Devonian regions.
An NRG spokeswoman told Twin Cities Business that the company’s expansion in Pittsburg was a “natural progression” based on the amount of activity and development that has occurred in the Marcellus region during the past seven years.
“The Marcellus shale gas play, along with all of the environmental, regulatory, and public affairs challenges that come with it, continues to evolve, and we’re thrilled to be in the heart of it all,” Mike Koester, NRG’s Pittsburgh office manager and senior regulatory specialist, said in a statement.
Koester told Twin Cities Business that examples of the Pittsburgh facility’s operations include planning, permitting, and inspection services for gathering pipelines (which transport gas to processing facilities or refineries) and for compressor stations in the region.
NRG currently employs seven at its Pittsburgh facility and hopes to increase the number to 15. Koester said that air quality specialists, regulatory specialists, field staff, and public affairs officials will be part of NRG’s Pittsburgh staff.
Granite Falls-based Fagen, Inc., also recently expanded to tap into the Marcellus region’s oil and gas industry. The industrial construction and general contracting company opened a facility in Houston, Pennsylvania last month to provide equipment and tool storage, as well as materials management for clients in the region—specifically in Ohio, Pennsylvania, and West Virginia.
The addition of a Pennsylvania location was “the first major step in demonstrating to our clients and the industry that Fagen, Inc., intends to become a major contractor in the midstream oil and gas marketplace,” the company said in a statement.
Other Minnesota companies have an eye on the booming growth surrounding the national oil and gas industries.
Rob Grunewald, an economist with the Federal Reserve Bank of Minneapolis, has pointed out that North Dakota, which has had one of the country’s fastest-growing state economies during the past five years, is an especially profitable area for Minnesota companies, including those investing in retail and housing.
Minnetonka-based Oppidan Investment Company is one such company. In the past year, Oppidan has invested more than $150 million to develop retail and residential properties throughout the Bakken region of North Dakota. In April, the property development company opened an office in Watford City, North Dakota to increase its focus on the state’s oil-rich region. In August, Oppidan partnered with Denver-based Consolidated Investment Group to develop a 43-acre residential community in Watford City, according to the Star Tribune.