One of the oil industry’s biggest service companies, Baker Hughes, has started developing a regional hub in Massillon.
Development of the Utica Shale in eastern Ohio is bringing one of the largest drilling service companies to the area.
Baker Hughes has begun developing a regional hub for oilfield operations on a 108-acre tract along the south side of U.S. Route 30.
The company is starting off smaller than originally hoped, building a bulk cement plant and a small wireline operation, along with truck bays. Initially the operation — expected to cost about $10 million — will have between 45 and 65 employees.
Massillon officials hope the project will lead to bigger things for Baker Hughes and attract other oil industry companies to the area.
“We’re looking forward to them being here,” Mayor Kathy Catazaro-Perry said.
Baker Hughes formed in 1987 with the merger of Baker International and Hughes Tool Co., but the company’s history traces back more than 100 years.
Ruben C. Baker entered the oil business by developing equipment that modernized cable tool drilling in 1907. Two years later Howard R. Hughes Sr. introduced the first roller cutter bit, which improved the rotary drilling process.
During the next 80 years the two companies continued developing new products used to improve the drilling process. Along the way both merged with other innovators, before joining forces.
The company now is organized into nine regions and 23 markets, including Europe, Russia, the Middle East and Asia Pacific. Baker Hughes’ services cover nearly every aspect of the drilling process.
The company might be best known for regular reports about the number of drilling rigs operating in the country.
Records filed last year with JobsOhio, the state’s private economic development arm, indicate Baker Hughes has high hopes for shale drilling in Ohio.
Drilling has focused on the Utica Shale, a formation about 7,000 feet below the surface and under much of the state. Companies hope to find liquid natural gas — used to get chemicals such as ethane, propane, butane and more — and oil in the eastern portions of the state. The Utica formation in west central Ohio is considered immature and has unknown potential.
There also is a tract of the Marcellus shale in the southeastern corner, as well as Utica Shale areas that are projected to produce dry natural gas.
Drilling companies have been exploring the Utica and Marcellus formations in Ohio since 2010 and believe the Utica shows the most promise.
But development has been slow because of low gas prices. There also has been the need to build systems for gathering and processing liquid natural gas.
Those factors have slowed Baker Hughes’ planned development in Ohio.
The company indicated it eventually would employ between 700 and 900 people in the state. It’s eventual investment here could be close to $564 million.
Page 2 of 2 - Baker Hughes spent $3.3 million to buy the Miller Farm, adjacent to the NEOCom industrial park. It also has allocated more than $400,000 to extend Millennium Boulevard SE north to the property where it plans to build.
MORE TO COME?
The first phase of the development will only use about one-third of the property Baker Hughes has purchased, which leaves more land open for development. The company said the site has the potential to be home to a liquid mud plant. Baker Hughes hopes to finish the project later this year.
Meanwhile, other companies that supply the oil industry are looking at the area. Three have opted to use the former Neomodal Rail Center as a location for storing materials used in drilling.
Catazaro-Perry and Bob Sanderson, president of the Massillon Area Chamber of Commerce, said several companies are looking at sites in the area.
The city has worked with the Stark Development Board and the Port Authority. It also has contacted companies and offered information about the opportunities in the Massillon area, Catazaro-Perry said.
While some of the early excitement over the Utica Shale has waned because of low natural gas prices, observers remain optimistic. Many are pointing to next year as a big time for growth.
“Once the infrastructure is in place, I think you will see the industry take off,” Sanderson said.
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