Two New Reports Highlight the Economic Power of Shale
Our tremendous shale boom has certainly taken a spotlight in the New Year. Over the past few weeks, both the American Petroleum Institute (API) and the U.S. Chamber of Commerce have released reports highlighting the game changing power of shale and the myriad benefits that come with it.
These reports explain that drilling advancements – including the combination of hydraulic fracturing and horizontal drilling – have unlocked deposits of natural gas and oil that were previously unrecoverable, transforming our energy outlook from one of scarcity to abundance in just a few short years. In fact without hydraulic fracturing, our situation would be completely different, as API explains:
“Without hydraulic fracturing, 45 percent of domestic natural gas production and 17 percent of oil production would be lost over the next five years. Further, hydraulic fracturing is expected to account for nearly 75 percent of natural gas development in the future.”
And the benefits of hydraulic fracturing and shale development in terms of jobs and economic growth couldn’t be clearer: as the API report states, large-scale projects that intersect an array of industries have translated into thousands of jobs, which have helped the United States reverse an economic recession. Furthermore, positions within the industry pay well-above average wages. From the API report:
“In 2012 alone, more than 38,000 Ohio jobs were supported by unconventional oil and natural gas activity. These oil and natural gas jobs also paid significantly more than other jobs throughout Ohio that year. While the average annual wage in Ohio was nearly $55,000 in 2012, the average wage of direct jobs in unconventional natural gas activity was $81,000.”
The Chamber of Commerce also touted the job creating power of shale, noting a finding from the Independent Petroleum Association of America (IPAA):
“[W]hile the gain in total U.S. employment from 2001 to 2011 was just 3.4%, employment in upstream oil and natural gas activities jumped by more than 60%, or nearly 194,000 jobs, a trend that appears to be continuing into 2012. These jobs also tend to be higher paying than average—nearly 50% above the national average wage.”
But the reports also offer a word of caution, pointing out that if we are to continue realizing the full potential of our vast resources, we have to ensure that unnecessary roadblocks are not put in the way of development. As the API report explains,
“If we are to realize this bright new energy future, America must make the right decisions today by deliberately choosing to take even greater advantage of our domestic oil and natural gas resources, choosing to ensure our ability to refine these resources within the U.S., and choosing to commit ourselves to continuing to build the world-class facilities and infrastructure necessary to bring these products to consumers in the U.S. and around the globe.”
The Chamber of Commerce echoes this sentiment:
“If not for the ingenuity and enterprise of America’s entrepreneurs, our energy present and future would not be as bright as they are. But a domestic energy renaissance is not a foregone conclusion. The positive changes to the U.S. energy picture documented in this report are not bound to happen; they can be derailed if the policy environment does not improve.”
The Chamber also points to the fact that the surge in oil and gas production has occurred almost completely separate from the federal government. It even goes as far to say that U.S. energy production has come about “largely in spite of national policy rather than because of it.” Recognizing the need to unleash the full potential of domestic shale development, the Chamber of Commerce lays out number of solutions to make development on federal lands more accessible.
Thanks to responsible shale development, we are seeing clear benefits to the environment, the U.S. economy and the individual consumer – and considering the abundance of our resources, the prospects for the United States will only get better.