Kosiba shares shale boom story at Cleveland summit

MAYFIELD HEIGHTS – Speaking at the Crain Cleveland Shale Summit 2013 last Tuesday, Larry Kosiba, the executive director of the Sustainable Opportunity Development Center in Salem, got a chance to tell people outside this area how the shale boom was changing things.

Called “Ohio & Shale: Getting it Right” the day-long conference attracted a “sold out” crowd of 600 that brought together people representing industry and civic interests in the shale boom.

The keynote speaker was former Shell Oil Company President John Hofmeister, who is also the founder and chief executive of Citizens for Affordable Energy.

Kosiba’s talked about how the shale boom was affecting Salem and Columbiana County with one hard-to-ignore consequence being that Salem now has no less that four hotel developers interested in it, along with the Timberlanes’ renovation.

Not only will lodging be an issue, but so will housing, Kosiba said Monday, following up on last week’s conference. While five hotels, including Timberlanes, may be useful and even needed, Kosiba is concerned about long-term sustainability and guiding the city through what could be explosive growth in a “smart” way.

He calls it the “pace” of development and the decisions made will have ramifications stretching years ahead.

Salem could maybe support five hotels for “how long?’ he asks. Our role is looking after sustainability, he said adding three or four empty buildings does no one any good.

“We need to look at it from sustainability,” he said, “developers need to do their homework … there will be winners and losers … it will be great for the building trades … but how long will they be here?”

He said developers should also consider exit strategies.

Aside from the competition, hype and broad range of considerations, Kosiba sees it as one step at time, but a quick step. He’s seen enough of how the oil gas industry operates.

When the companies need it, they need it now. If the first call fails, they make the second and third until they get it.

It’s immediate gratification in the extreme: “I want it all and I want it right now.”

Kosiba recognizes that.

“We need to start preparing and get out in front of this stuff or we’re going to get overrun,” he said, noting infrastructure for transportation, both primary and secondary roads, will need extra maintenance.

He also pointed out that the area lacks rail support, which is necessary to bring in the sands and water for drilling wells.

Communities will see a crunch in lodging and local businesses will see undergraduate management and skilled trades raided as the shale boom tightens its grip.

Kosiba wonders and then worries about those talent pools, noting local companies will need to find ways to attract people siphoned off by the boom.

“Getting them here is the hard part,” he said, adding there will be a significant void for undergrads.

Kosiba tries to overlook the hype, but that’s almost impossible. There’s a lot of it now and a lot is happening that people can’t see.

Kosiba told the shale summit, “What we’re seeing is a lot of our landowners and property owners are hearing about other areas where there is maybe more activity and wondering why it hasn’t filtered into our area.”

But it has, he said noting that “what Salem needs to understand is there’s maybe a hundreds of Salems up and down and if they don’t get it here, they’ll go to the next that will accommodate them.”

Getting there, to get to that receptive economic environment, Kosiba suggests “getting it smart … we have to do some planning … define places for housing.”

He stresses the need for housing will rise and “as one developer comes in and is challenged, others will see that … housing, housing, the needs will be tremendous … again, it should be done in a planned manner.”

As far as wondering why “more activity hasn’t filtered into out area,” Kosiba said, “the pace is something that people will have to adjust to … we can either embrace it or watch this go to other communities.”

Larry Shields can be reached at lshields@salemnews.net