At the dawn of a new year, it is appropriate to take stock of America’s ever-giving oil and natural gas bounty—and realize that much more of a good thing is in store given market incentives to produce and consume.
Oil and natural gas are the energies of our lives. No hyperbole there. Oil and natural gas are the source of energy-intense fuels for transportation as well as warmth in the winter and cooling in the summer.
They’re also the building blocks for a number of products we use every day, making our lives more modern, more comfortable and safer. Every day 143 U.S. refineries convert an average of 15 million barrels of crude oil for these uses and more.
For 9.8 million Americans, the oil and natural gas industry supports their employment – directly, indirectly in supporting industries and across our economy in jobs that wouldn’t exist without oil and natural gas development.
Real Jobs, Big Numbers
The oil and natural gas industry and the jobs it supports already account for 5.6 percent of total U.S. employment. With the right policies in place – pro-development policies that increase access to domestic reserves – industry could add another 1.4 million jobs by 2030.
Many opportunities stand to await younger workers with estimates that up to 50 percent of the oil and natural gas industry’s skilled workers could be retiring within a decade, according to one report.
Another way the oil and natural gas industry is helping the U.S. jobs picture is by fueling a renaissance in manufacturing. That includes demand for materials and equipment for oil and natural gas production itself, but also lower energy costs for a variety of manufacturers as they take advantage of affordable natural gas.
A recent study by IHS, “America’s New Energy Future: The Unconventional Oil and Gas Revolution and the U.S. Economy,” predicts that lower natural gas prices will increase industrial output 2.8 percent by 2015 and 3.9 percent by 2025.
Trade and Domestic Capacity
In other ways safe and responsible energy development is helping boost the economy, which translates into more jobs, more opportunities for American workers.
With policies that allow the export of U.S. liquefied natural gas (LNG), for example, an ICF International study says that between $15.6 billion and $73.6 billion could be added to GDP annually between 2016 and 2035.
Meanwhile, exports of distillate fuel are up 30 percent from last year, which means overseas markets for valuable U.S. commodities are being developed, helping the domestic refining industry, which supports about 529,000 jobs with an average annual income of $111,542, to continue growing.
U.S. refining is a success story of its own, parlaying more than $28 billion in capital expenditures into new technologies and improved facilities that have helped increase capacity nearly 230,000 barrels of oil per day from 2008 to 2013 – even as Europe has seen its refining capacity shrink.
Economic Brightness Awaits
America’s oil and natural gas companies bring us the fuels that power our standard of living every day. And they can do more – with policies that open new access to American energy reserves. The concept of American energy for Americans is something that’s broadly supported in this country. A recent poll found 67 percent of voters support offshore drilling for oil and natural gas.
This stems, at least in part, from the fact that U.S. energy security is at hand, thanks to domestic production and strong energy partnerships with countries like Canada, our No. 1 source of imported oil. As unimaginable as it might have been just five years ago, the right policy decisions could see the U.S. meet 100 percent of its liquid fuel needs domestically or from Canada by 2024.
It also means making investments in new energy infrastructure – for example, building on safe product delivery systems, including a network of oil and natural gas pipelines that carry more than 14 billion barrels of crude oil each year, and 25 trillion cubic feet of natural gas in 2012.
Access, common-sense regulation and crafting an environment that encourages energy investment can combine for a strategy that keeps America’s oil and natural gas industry strong and producing for Americans.
Mark D. Green is editor and lead contributor to Energy Tomorrow, a project of the American Petroleum Institute. The holder of a masters degree in journalism and history from American University, Green is working on a masters in history at George Mason University where he teaches in the Department of Communication.
This blog was originally posted under the title “Energy Today, Investing in Tomorrow” at Energy Tomorrow.