The natural gas boom was supposed to bring prosperity to West Virginians in poverty. That didn’t happen

In between shifts at low-income jobs, West Virginians in natural gas country braved the late August heat and lined up at a New Martinsville church in Wetzel County to pick up canned food, frozen meat and back-to-school clothing. Some drove more than an hour to get there.

Grandparents with custody of their grandchildren, single mothers and people making barely above minimum wage waited their turn to choose from racks of clothes, and a team of about 20 volunteers provided them with lists of other charities that can help.

Since the food pantry opened four years ago, the need has only grown, according to Tina Rucker, who runs it. It serves nearly 1,000 people a month.

“People are working at McDonald’s, at Wendy’s, Burger King – that can’t make it,” she said. “They make too much to get help from the state. And if it weren’t for us, they wouldn’t be able to feed their families.”

Natural gas companies like Antero and EQT, major oil and gas companies in the region, donate about a third of program costs, Rucker said.

When the natural gas industry boomed, residents in the area had expected a surge in good-paying jobs. Instead, they’re increasingly reliant on charity.

More than a decade ago, natural gas companies sold West Virginians on a bright and prosperous future with tens of thousands of new jobs. Companies have pulled billions of dollars of natural gas out of the ground, yet many people here still can’t afford basic necessities like food and clothing.

The American Petroleum Institute, the trade group representing the nation’s oil and natural gas industry, promoted the predicted job growth and didn’t answer inquiries about why it didn’t take place. EQT and Antero also didn’t respond to requests for comment.

In recent years, state officials also said West Virginia was on the verge of what they called a petrochemical renaissance based on plastics developed from natural gas liquids.

They described a hopeful future for the state, which they said would include the construction of multiple facilities needed to use byproducts of natural gas for the development of plastics. That plan has largely failed .

“West Virginians enjoy significant economic and environmental benefits thanks to the development and use of our homegrown natural gas and oil,” said Charlie Burd, executive director of the Gas and Oil Association of West Virginia, when touting the release of a report last year showing more than 70,000 jobs in the state from the gas industry.

Analysts have cautioned against using that number to determine the industry’s economic impact because it includes indirect jobs like employment at oil refineries and gas stations.

As the industry matures, there are fewer and fewer jobs in the industry, according to reports authored by Sean O’Leary, senior energy researcher at the Ohio River Valley Institute. The natural gas producing areas of the state have generated a lot of wealth for companies and some residents, but that is not reflected in average incomes and number of jobs.

“Generally speaking, the effects on economic prosperity were negligible to downright negative,” said O’Leary.

Population and job loss instead of prosperity

At the Wetzel County Museum, Nathaniel McDowell pointed toward a rendering of a bustling, brightly-lit New Martinsville as it looked decades ago hanging on the wall. Standing next to a display that said “A County is Born,” he said people settled in the town because of nearby gas drilling.

“This town used to be a very prideful town,” he said. “There were picnics. There were parades out in the street. Everybody knew everybody. Now we’re faceless.”

McDowell, who works at the museum, was wearing an Oil and Gas Festival shirt, one of many community activities that natural gas companies sponsor. But he also talked about how a century ago, oil and gas executives frequented and opened other local businesses.

“Yeah, they pay you a lot, but none of that goes to the towns,” he said. “None of it gets recycled back into the economy.”

McDowell also watched many of his high school classmates leave the area.

As Appalachian natural gas has contributed more and more to the nation’s economy over the last 15 years, people in the counties where it is produced aren’t reaping the same benefits, according to a 2021 report by the Ohio River Valley Institute. Researchers looked at economic data from 22 counties in Ohio, Pennsylvania and West Virginia that produce most Appalachian natural gas.

From 2008 to 2019, income and jobs grew slower in the natural gas counties than both the nation and the combined three states. Population declined by 3.8% in those counties.

Over the course of the natural gas boom, jobs were created but have since declined. Incomes have fallen further behind the rest of the nation, and population loss has worsened in these counties, according to a 2023 update of that report .

West Virginia counties included in the report were Doddridge, Harrison, Marshall, Ohio, Ritchie, Tyler and Wetzel, located in the natural gas-rich Appalachian Basin.

Technological advances allowed natural gas producers to drill much farther horizontally underground, reaching greater gas reserves. Hydraulic fracturing, or fracking, pumps huge amounts of water, sand and chemicals underground to free gas from shale deposits.

“Once wells are dug, they don’t require the same amount of attention that they do when they’re being drilled,” O’Leary said.

In New Martinsville, McDowell said he’s seen local businesses struggle because many natural gas jobs went to out-of-state workers, who only stayed for short periods of time.

Many people who owned the rights to natural gas drilled on their land either sold those rights or receive royalty payments, based on a percentage of the revenue from the drilling. Some became wealthy.

But companies said that money would be spent locally. O’Leary said local land-owner royalties largely went to paying down debts, saving the money or making one-time large purchases.

“They might have gone out and bought a car or even a house in Myrtle Beach,” he said.

A missed opportunity

A 2010 press release from the American Petroleum Institute said West Virginia had a “challenging tax and regulatory climate.” So, companies did slightly hedge their expectations. They said state lawmakers would have to stay out of their way.

Those lawmakers did. In fact, they rolled out the red carpet by acquiescing to the industry time after time at the state Legislature.

Among other measures, they rejected plans to require companies to report the number of in-state workers. They also rejected protections for mineral-rights owners and residents who live near drilling operations and worry about the associated pollution.

Lawmakers have also continued to reject legislation to require companies to clean up abandoned wells that can release the greenhouse gas methane.

But state officials missed opportunities to prepare for the future by planning only to ride the coattails of the industry, according to O’Leary.

“Frankly, a lot of them just stopped looking at or stopped thinking about other ways to do economic development,” O’Leary said. “And so there was a huge opportunity loss associated with the natural gas boom, because folks simply assumed that it would be the savior.”

In the early 2010s, Jeff Kessler, a former Democratic state Senate president and gubernatorial candidate, advocated for a fund made up of taxes from the natural gas industry. He’d said lawmakers would only be permitted to use interest generated by this Future Fund, so it would grow over time.

Kessler said the Future Fund was meant for investments, like training for trade jobs or infrastructure. Other states, including Wyoming , New Mexico and North Dakota have similar funds, giving officials billions of tax dollars from the extraction of natural resources to reinvest in their states.

“When the coal’s gone and the gas is gone, there’d be a source of significant wealth built up to help advance services and programs that improve the quality of life for the people who live here, not for the damn companies that have made all the money and left us,” he said.

But because other lawmakers successfully pushed to include restrictive requirements for depositing money into the fund, no money was ever deposited. Then the Future Fund was repealed last year.

Kessler said lawmakers could have preserved some of the proceeds for residents left behind and the revitalization of towns once the wells were drilled in the region.

“I think they got bamboozled some,” Kessler said.

Sen. Charles Clements, R-Wetzel said despite fewer than predicted new jobs, some residents  improved their quality of life.

“And I’ve seen people that just didn’t have anything, then all of a sudden, they run into a lot of money, but a lot of people never changed their lifestyle,” he said. “They put the money in the bank, and it’s probably still sitting there. Their kids are going to be happy maybe someday.”

Clements said that initially many jobs went to out-of-state workers, partly because people were reluctant to move from their hometowns to other counties.

He also said that, since then, local residents have picked up new skills and have taken some of those jobs.

Some schools, especially those in outlier counties like Doddridge County, have reaped the benefit, he said, and are receiving more funding per student than the rest of the state.

Some roads are patched up, but damage is done

The explosion in drilling did bring some improvements. Jobs grew at a faster rate in Doddridge County than in the rest of West Virginia. That county has been able to use taxes from the industry to build schools, a new courthouse annex and an upgraded public library.

And in New Martinsville, the Wetzel County Center for Children and Families is freshly painted due to help from natural gas companies that also sponsor many of their programs for low- income residents. The center has a clothing closet and group activities for kids.

In roads close to towns like New Martinsville in Wetzel County and West Union in Doddridge County, potholes have been patched.

But farther out on more narrow roads, there is warning tape cautioning drivers because pieces of the heavily-trafficked road are falling off the hillside.

And along the highway in Doddridge County, a massive natural gas processing complex replaced rolling hills and trees.

Clements said lawmakers have allocated highway funding, and he said some residents don’t realize the companies paid for road repairs as well.

“And they’ve been very generous with charities,” he said. “Of course, they’re making an awful lot of money.”

The natural gas boom was supposed to bring prosperity to West Virginians in poverty. That didn’t happen appeared first on Mountain State Spotlight , West Virginia's civic newsroom.