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Businesses Seeing Major Slowdown In Marcellus Shale Drilling Areas

WAYNESBURG (KDKA) -- The slowdown in the gas fields has hit Main Street in Marcellus Shale country.

Towns like Waynesburg in Greene County came back strong with the shale gas boom as a steady stream of gas workers filled their stores and restaurants. Just three years ago at Hot Rod's House of Bar-B-Que, you couldn't get a seat at lunchtime.

"This is the lunch business now. On Monday, we used to be full," said Rod Phillips, the restaurant's owner. "Two table on this side, and on the other side, I think we have three on that side today."

The boom has gone bust, at least for now, and the numbers show it.

Nearly every company that's active in the shale play has reduced jobs, has reduced capital allocation by as significant margin," said David Spigelmyer, of the Marcellus Coalition.

In 2013, there were 120 rigs begin drilled in the region. This year, there are only 30.

Layoffs are hitting major companies in waves. Range Resources last week laid off 55 employees, including 31 in Washington County. Southwestern Energy has laid off 200 workers in Pennsylvania, and Chevron 162.

And that has sent shock waves through the Washington County and Greene County economies.

"The real gut punch is the supply chain jobs and there are thousands and thousands of those across this region and they're feeling the pressure as well," said Spigelmyer.

John Bruno, of Mickey's Men's Store on High street, says oil and gas workers saved his business with their steady purchases of work boots and flame-retardants clothes.

But he's now a victim of global economic forces. An oversupply of both oil and natural gas and a lack of demand has resulted in historically low prices. The subsequent pullback by the gas companies means far fewer customers for Bruno, though he's hopeful of a turn around.

"We should be able to weather the store," he says.

He just hopes it doesn't go on too long.

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But even if working off that oversupply takes a year or two years, the industry as a whole says it will weather the storm.

"When you say bust, it doesn't mean this industry's going away," Spigelmyer says. "We still have a lot of gas to produce and a lot of jobs to generate again once we get the economics correct."

So after seven or eight good years, it's hunker down and ride it out and hope that the hard times don't last two long.

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