A new study illustrates the far-reaching economic contributions of unconventional oil and natural gas development, particularly in the manufacturing sector, says API Vice President for Policy and Economic Analysis Kyle Isakower.
“The oil and natural gas revolution has created millions of jobs, and this study shows the broader economic benefits are being felt by households and manufacturers across the U.S.,” said Isakower. “Oil and natural gas have been pillars of the recovery, and other sectors are now coming back stronger and faster because of affordable and abundant energy and raw materials - despite economic headwinds. As a result, Americans have more income, more buying power, and a more competitive economy.”
The study by IHS Global Insight, “America’s New Energy Future: The Unconventional Oil and Gas Revolution and the Economy – Volume 3: A Manufacturing Renaissance,” expands on IHS’s earlier research into unconventional oil and natural gas -- resources generally unlocked from shale deposits and other tight formations using hydraulic fracturing and horizontal drilling. The latest report outlines the full chain of economic activity resulting from unconventional development, from drilling and refining to petrochemical supplies and manufacturing. According the study, the full unconventional value chain supported 2.1 million jobs last year, and is projected to support 3.9 million jobs by 2025, including 515,000 manufacturing jobs.
“Unconventional energy has been a remarkable economic stimulus with implications far beyond oil and natural gas producing states,” said Isakower. “New supplies are changing the game for businesses that use or make energy-intensive products including chemicals, aluminum, steel, cement, and foodstuff. But to unlock our full manufacturing potential, those in Washington must turn aside efforts that would impose duplicative regulations on shale development, raise production costs, and limit access to domestic resources.”
According to the study, unconventional oil and gas will steadily increase U.S. competitiveness, contributing $180B to the U.S. trade balance by 2022. In addition, unconventional energy:
Increased disposable household income by $1,200 in 2012, rising to $3,500 in 2025;
Generated $74B in government revenues in 2012, rising to $138B in 2025;
Attracted U.S. capital investments totaling $121B in 2012, rising to $240B by 2025;
Contributed $284B to the U.S. GDP in 2012, rising to $533B by 2025; and
Supported $150B in earnings for U.S. workers in 2012, rising to $269B by 2025.
A copy of the report can be found here(http://www.api.org/news-and-media/news/newsitems/2013/sept-2013/~/media/Files/Policy/American-Energy/Americas_New_Energy_Future_Mfg_Renaissance_Main_Report_4Sept13.pdf). The executive summary is available here(http://www.api.org/news-and-media/news/newsitems/2013/sept-2013/~/media/Files/Policy/American-Energy/Americas_New_Energy_Future_Mfg_Renaissance_Exec_Sum_4Sept13.pdf).
About American Petroleum Institute
API is a national trade association that represents all segments of America’s technology-driven oil and natural gas industry. Its more than 550 members – including large integrated companies, exploration and production, refining, marketing, pipeline, and marine businesses, and service and supply firms – provide most of the nation’s energy. The industry also supports 9.8 million U.S. jobs and 8 percent of the U.S. economy, delivers $85M a day in revenue to our government, and, since 2000, has invested over $2T in U.S. capital projects to advance all forms of energy, including alternatives.