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Shale Gas: A Global Phenomenon 3 | MARCELLUS SHALE COALITION Source: Energy Information Administration

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Shale Gas Revolution Across the U.S. 4 | MARCELLUS SHALE COALITION Source: Energy Information Administration

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Marcellus and Utica Shales Below the Marcellus Bigger, deeper, denser One of the last U.S. unconventional energy fields Particularly attractive in OH Success in the Marcellus will lead to success in the Utica

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Clean, Abundant, and Versatile Resource-How will things be different? Heating and cooling sources Light duty and heavy duty transportation Fuels Generation of electricity Combined heat and power applications Feedstock for industries Utilization of liquids in Wet Natural Gas 6 | MARCELLUS SHALE COALITION

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Natural Gas Fundamentals Three Industry Segments Upstream: bringing natural gas to the surface (drilling) Midstream: storing and transporting natural gas (pipelines, etc.) Downstream: selling and distributing natural gas (your supplier) Types of Natural Gas Dry Gas: Home, business heating and fueling Wet Gas: Contains Natural Gas Liquids, or NGLs; Raw material for other products (polymers, paints, plastics, fertilizers, etc.)

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Natural Gas Power Plants 46 % by 2035 Natural Gas Vehicles U.S. has 110,000 (.9167%) Worldwide 12 Million Infrastructure (Fueling Choices) Industrial Feedstock

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Shell Picks Pittsburgh Area For Major Refinery Several BILLION $ to build the plant 500 -1,000 Full time jobs 10,000 +/- construction jobs for several years Plus additional downstream Industries with additional job and state revenue opportunities.

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Average Composition in Wet Gas Region Source: Pace Global; NiSource Gas Transmission and Storage Presentation to WVONGA Spring Meeting May 6, 2010 p.5

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Pulp and Paper Metals Chemical plants Petroleum refining Stone Clay & Glass Plastics Food Processing

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Why Chemical Makers Love Cheap Natural Gas Margins at U.S. chemical companies are at their highest in years due to the glut of natural gas. New factories are being planned, and current ones are running at full capacity. European and Asian chemical manufacturers use oil-derived naphtha to make ethylene. With ethane prices currently around 70 cents a gallon, it costs U.S. producers about $730 to make a ton of ethylene, while manufacturers that use naphtha to make polyethylene are paying nearly $1,250 a ton.manufacturers that use naphtha to make polyethylene are paying nearly $1,250 a ton Adding insult to foreign rivals injury, U.S. chemical manufacturers can take advantage of cheap natural-gas-fired electricity to run their refining operations. Every 10-cent drop in the cost of ethane boosts Dows earnings by nearly $200 million. Mar 2, 2012, 6:00 am EDT | By Aaron Levitt, InvestorPlace ContributorAaron Levitt

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Comparing the importance of natural gas to the chemical industry to flour in a bakery, Babe said theres great promise for the regions chemical industry in Shell Oils recent announcement that it has chosen a location in Beaver County to build a $2 billion ethane cracker. Greg Babe, president and CEO of Bayer Corp. and Bayer MaterialScience LLC, speaks May 23 at a VisionPittsburgh event at the Duquesne Club. It really could signal the revival of Americas petrochemical industry, Babe said. That competitive advantage stems from the abundance of the supply, Babe said, which will help create cost advantages and provide a predictable feedstock. Friday, May 25, 2012

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Liquefied Natural Gas LNG is a clear, colorless, non-toxic liquid that can be transported and stored more easily than natural gas because it occupies up to 600 times less space.

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EXISTING IMPORT TERMINALS Today, there are 12 U.S. facilities (and one facility in Puerto Rico) capable of importing LNG. They are located in: Everett, Massachusetts Cove Point, Maryland Elba Island, Georgia Lake Charles, Louisiana Gulf Gateway Energy Bridge, Gulf of Mexico Northeast Gateway, Offshore Boston Freeport, Texas Sabine, Louisiana Hackberry, Louisiana Neptune LNG, Offshore Gloucester, Massachusetts Sabine Pass, Texas Pascagoula, Mississippi At present, the U.S. has one existing LNG export terminal located in Kenai, Alaska.

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Cheniere Wins Approval for Biggest U.S. Gas-Export Terminal By Brian Wingfield and Joe Carroll - Apr 17, 2012 4:34 PM ET Importing Countries expected to have high gas prices through 2018 Example: Japanese Utilities are paying $20.87 per Million Btus = 10 times the U.S. price. There is a great window of opportunity Energy Independence: Boosting LNG Exports

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What About This? You've heard this before: "Shale gas is a gamechanger." Charles Patton, president and chief operating officer of Appalachian Power Co. said that as power plants in the company's fleet and elsewhere are retired, "there's just a run to natural gas."

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Complex Hydro Carbon Simplest Hydro Carbon Natural Gas (methane) has highest hydrogen-to- carbon ratio of any hydrocarbon Diesel is a complex hydrocarbon, while natural gas or methane is a simple hydrocarbon. Simply, more carbon means more emissions have to be handled. The future looks toward hydrogen, minimal carbons.

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Natural Gas is a Safe Fuel Lighter than air Rises (rather than pools) Doesnt accumulate in low places Rich mixture burns off slowly Ignites at temperatures of approx. 600 C (higher flash point) Non toxic Odorless-detection fragrance is added Evaporates quickly Heavier than air Descends Accumulates in low places Rich mixture explodes Gas and diesel vapors ignite at approx. 200 C Toxic, especially gasoline Strong inherent odor Evaporates slowly at room temperature CNG Liquid fuels

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Target NGV Fleet Applications Refuse collection and transfer Transit Port drayage Local trucking and distribution Public works (street sweeping, road maintenance, dump trucks, etc.) Airport operations (taxi, hotel/parking shuttle bus)

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Oil City NG Fueling within 50 miles

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http://www.afdc.energy.gov/afdc/locator/stations/

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The Pennsylvania Clean Transportation Corridor will: Result in more than $200 million in investment in Pennsylvanias economy. Have a direct impact on more than 1,350 jobs in Pennsylvania. Save Pennsylvania fleet operators nearly $10 million in fuel costs annually. Yield more than $60 million in tax revenue for the Commonwealth of Pennsylvania. Reduce emissions of diesel soot (14.5 tons), 720 Tons Nox (Nitrogen Oxide) ozone-causing pollution and 21,000 tons of greenhouse gas NEED PA NG SUCCESS STORIES

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The Pennsylvania Clean Transportation Corridor is a strategically planned network of natural gas refueling infrastructure connecting: Philadelphia Scranton / Wilkes-Barre Allentown Harrisburg Pittsburgh This corridor will serve as the cornerstone of a larger regional clean fueling network throughout the northeastern United States.

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The Right Choice. Right Now Environment, Energy Security and Economics Drive Local Governments Increased Use of Vehicles That Run on Natural Gas Refuse Truck fuel usage=8,500-10,000 gallons per year. @$4.00/gallon = $34,000 to $40,000 Estimated savings between 30 and 50% Savings by using NG @ 30%= $10,200.00 to $12,000.00/year Savings by using NG @ 50%= $17,000.00 to $20,000.00/year Plus buying incentives of $32,000.00 per heavy duty truck and 90% quieter. As well as the cleaner burning fuel

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Heavy-duty diesel powered trucks 3-4% of all registered on-road vehicles. They are responsible for 25% of all on-highway fuel (both gasoline and diesel). The largest trucks heavy-duty Class-8 11 trucks represent only 33% of the total number of registered heavy vehicles in all weight categories (Classes 3 12 to 8). They are responsible for 64% of the total miles traveled and 67% of the total fuel consumed by all commercial vehicles1 3.

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http://www.afdc.energy.gov/afdc/locator/stations/ ONE Trash Truck using NG will take 325 cars off the road!!

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