1. Eastern Ohio Outlook on Petrochemical Development
February 22, 2018

2. 85% of Natural Gas Growth from Marcellus/Utica
Region represents 85% of shale gas growth in US since 2012
25 Bcf/d of natural gas production (EIA)
Production expected to reach 29 to 33 BCF/d by (RBN Energy LLC)

3. Utica Shale Wells
Over 2,100 Horizontal Utica Shale wells drilled in eastern Ohio
Laterals have exceeded 18,000 feet horizontally – some of the most productive shale gas wells in the world
Baker Hughes Rig Count 02/09/18:
PA = Marcellus 37
Ohio = Utica 23
WV  = Marcellus 19
Source: ODNR

4. Long-Term Global Price Advantage

5. Pre-2011 Energy/PetChem Presence in Ohio
Attraction opportunity for Ohio
Upstream extractors
Raw fossil fuels
Pipelines
Fractionators/processors
Methanol plants
Methanol plants
Power generators
Ammonia plants
Refineries
Steam crackers
On-purpose propylene plants
Industrial chemicals and polymers companies
Complex chemicals
*Not exhaustive
Includes indirect and induced jobs 5

6. Hydrocarbon Value Chain Still has Gaps
$54 B Invested
*Not exhaustive

7. Midstream Network
Robust and Growing Interstate Natural Gas Transmission Pipeline Network
Proximity to 10 Natural Gas Processing plants and five fractionators
Four major NGL interstate pipelines built or under development
Developing underground NGL storage

8. Appalachian Basin NGL Production
Natural Gas Liquids (NGLS) are a major source for petrochemical feedstocks
740,000 barrels/day in 2016 (RBN Energy LLC)
NGLs production expected to reach 1,200,000 b/d by 2022 (RBN Energy LLC)
Consuming near source can avoid pipeline transport costs to Gulf of approx. $0.15/gallon
- “Mapping the Utica Shale,” CSU

9. Regional Opportunities
Ethylene, methanol, ammonia, propylene, specialty chemicals.
Energy intensive manufacturers
CSU study estimates each ethane cracker will create over 650 supply chain jobs each.
Regional fabrication, contract maintenance, warehousing, and compounding operations possible.
Competitive freight advantage for polyethylene pellet users
Enough ethane to support more crackers

10. PTTGCA final investment decision expected around the end of the year
PTTGCA final investment decision expected around the end of the year. Approx. 5,000 peak construction jobs. Hundreds of permanent jobs.

11. 10 Gas-fired Power Plants Currently Under Development
Coal once provided nearly 90% of Ohio’s electricity; now 58%.
Over 6,500 MWs of coal-fired generation has been shut down or planned for retirement in region
Inexpensive and abundant natural gas filling the void
Capacity on PJM Transmission Grid
Planned retirements: AES’ Stuart and Killen = 3.000MW, Muskingum River = 1,425MW, Conesville units 5 & 6 = 820 MW, Burger = 568 MW, Sammis four untis = 720 MW.
Sources: EIA, PUCO, & press reports

12. Regional Challenges in the Valley
Bias of Petchem companies toward Gulf of Mexico
Site Challenges
Limited number of large river sites
Topography – hills & floodplains
Brownfields
Lack of Infrastructure
Lack of Zoning/potential conflicting uses adjacent
Limited dual rail options
Owners need for ROI vs. patient waiting for Petchem projects
Perceived construction cost premium
Competition for NGLs with Pipelines

13. Mike Jacoby
(740)