Oil exploration in Ohio boosts local steel mills
The United States sources much of its natural gas from domestic production. And this has never been more apparent than during the recent gas production boom in Ohio, Pennsylvania, and West Virginia.
As Keith Schneider reports in the New York Times, new oil and natural gas drilling is creating a large demand for steel pipe and tube infrastructure used to tap new wells. Last October, U.S. Steel opened a 325,000-square-foot mill at its Lorain, Ohio plant to manufacture steel pipe for the oil drilling industry. And in Canton, Ohio, the Timken Company is building a new operation to cast steel billets used for drilling platforms, heavy equipment, and other oil and gas industry tools.
The turnaround for Timken from a recent recession lull is especially pronounced. Schneider says that in May 2009, Timken's factory operated for only four days.
This gas boom could be welcome news for domestic steel makers, but only if drilling companies utilize American-made steel pipe.
As we reported yesterday, some Ohio legislators are hoping that the natural gas boom can also lead to a sustained Ohio steel boom. They have introduced new legislation, HB 559, that would require pipeline operators in Ohio to report the country of origin and manufacture of the steel products being used for natural gas development.
The Alliance for American Manufacturing (AAM) strongly supports such efforts and testified yesterday on Ohio to help promote such domestic sourcing.
Click here to read AAM's full testimony in support of HB 559.
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