NEW YORK Low
domestic energy prices due to the shale exploration boom are
already spurring manufacturing in the United States.
"There has been a lot
of talk about economic growth from the shale boom in parts of
North Dakota, Ohio, Pennsylvania and Texas, where new energy
production is taking place, but some of the greatest benefits
are filtering down to conventional factories across America,
like mine," according to Drew Greenblatt, president of
Baltimore-based Marlin Steel Wire Products LCC, who is also a
board and executive committee member of the National
Association of Manufacturers (NAM).
Greenblatt made his
comments during testimony before a joint hearing of the House
Energy and Power subcommittee and the House Commerce,
Manufacturing and Trade subcommittee.
"When I bought Marlin
Steel Wire Products in 1998, we had about $800,000 in sales and
18 workers. Last year was our most successful one as a
business, with more than $5 million in sales. One of the
primary factors for our recent achievements has been the
dramatic increase in domestic energy production and lower
energy prices," Greenblatt said.
Lower energy prices
are also helping other manufacturers compete globally,
increasing opportunities for companies like Baltimore-based
the country are expanding production and winning contracts
that, even a few years ago, they had little chance of competing
for as foreign companies produced goods at lower costs. Now, it
is U.S. manufacturers who find themselves able to produce more
for less, and it is our competitors who are scrambling to keep
up," Greenblatt said.
It costs "less than
$400 a ton to produce ethylene in the U.S. That compares to
more than $1,000 a ton in Europe and even more in Japan" due to
low energy prices, meaning "dozens of companies are making
plans to invest in new U.S.-based chemicals production
capacity," Dean Cordle, president and chief executive officer
of chemical maker AC&S Inc., Nitro, W.Va., said.
are benefitting from the boom in direct sales to the oil and
"We are also selling
material-handling solutions from steel wire and sheet metal to
clients directly involved in developing and extracting these
sources of energy," Greenblatt said, citing such companies such
as Schlumberger Ltd., Halliburton Co., Timken Co. and
Paul Cicio, president
of the Industrial Energy Consumers of America (IECA), sounded a
cautious note during the hearing on the export of liquefied
natural gas (LNG) and its potential to raise energy prices.
The U.S. Energy
Department failed to perform due diligence when it gave
Freeport LNG Development LP conditional approval to export LNG
to non-free-trade agreement countries from its Quintana Island,
Texas, terminal, Cicio said. While IECA isnt opposed to
LNG exports, the group is concerned that the agency moved too
quickly and didnt consider that a rapid jump in exports
could raise domestic energy prices and hurt growth in the U.S.
manufacturing sector, he added.