COLUMBUS, Ohio – Investment in Ohio’s shale energy sector totaled approximately $3.1 billion during the second half of 2023, a new report from Cleveland State University finds.

The latest report was prepared for JobsOhio, Ohio’s private nonprofit economic development corporation, and covers shale-related investment in Ohio from July 2023 through December 2023 and cumulates total investment from 2011 forward.

The study, from CSU’s Energy Policy Center at the Maxine Goodman Levin School of Urban Affairs, also shows that cumulative oil and gas investment in Ohio between 2011 and December 2023 is estimated at approximately $108.2 billion.

Of this, $76.7 billion has been in upstream, $22 billion in midstream and $9.5 billion in downstream industries. The study shows that cumulative shale-related investment steadily rose between 2011 and 2023.

As the spread between oil and natural gas prices has increased, finding and development costs for oil have been falling, driven by innovations that improve the operational efficiency of production from shale wells. The study suggests that the application of artificial intelligence to upstream operations could drive additional improvements.

“As natural gas exploration technology continues to evolve, Ohio’s abundance of resources can play an essential role in supporting economic growth in industries like advanced manufacturing, health care, polymers, construction, aviation, and automotive,” said J.P. Nauseef, JobsOhio president and CEO. “Since 2011, the shale-related investment in Ohio’s energy economy has steadily increased to $108.2 billion as industry experts and investors look to the state for growth.”

Total shale-related investment was up $1 billion in the second half of 2023 compared with the first half of the year, due to construction starting on a major natural gas power plant, said Mark Henning, research supervisor for the Energy Policy Center in the Maxine Goodman Levin School for Urban Affairs at CSU.

The Trumbull Energy Center power plant in Lordstown is now under construction and represents $1.2 billion of the $3.1 billion in investment during the second half of 2023, the study said.

“This level of overall investment will likely continue as upstream producers continue to ramp up activities in the region’s oil window, where we have seen new well development more than double during the first half of 2024 compared to the second half of last year,” Henning said.

Upstream Investment

Overall, upstream investments were down by about $332 million in the second half of 2023 compared with the first half of the year, reflecting a decline in the number of new wells drilled. Oil prices have remained high relative to natural gas prices, sustaining an average oil-to-price ratio of 6:1 since the beginning of 2023. 

Midstream Investment

Midstream investment reached $290.4 million in the second half of 2023, a 69% increase compared with the previous six-month period. Most of the midstream investment during the study period was for gathering system and transportation buildout, with $166.9 million spent on gathering lines and $91.9 million spent on compression. An additional $31.5 million was spent on NGL pipelines.

Downstream Investment

Since 2015, the CSU studies have reported that 10 natural gas-powered power plants have been in the planning, construction or newly operational stages. Seven of these plants consumed 13% of Ohio Utica gas production for power generation during the second half of 2023 and generated the equivalent of approximately 35% of the electricity consumed in Ohio across all sectors during the same period.

This is the 16th CSU study reporting investment resulting from oil and gas development in Ohio related to the Utica and Point Pleasant formations. The latest report and previous reports can be found HERE. More information on Ohio’s growing energy industry is available HERE.