Onshore and Offshore Resources
The development of America's vast domestic oil and natural gas resources that had been kept off-limits by Congress until recently could generate more than $1.7 trillion in government revenue, create thousands of new jobs and enhance the nation’s energy security by significantly boosting domestic production, according to an ICF International study commissioned by the American Petroleum Institute (API).
The study shows that developing the offshore areas that had been subject to Congressional moratoria until recently, as well as onshore areas—resources in Alaska's Arctic National Wildlife Refuge and a small portion of currently unavailable federal lands in the Rockies—would lift U.S. crude oil production by as much as 2 million barrels per day in 2030, offsetting nearly a fifth of the nation's imports. Natural gas production could increase by 5.34 billion cubic feet per day, or the equivalent of 61 percent of the expected natural gas imports in 2030.
The study also estimates that the development of all U.S. oil and natural gas resources on federal lands could exceed $4 trillion over the life of the resources.
"This study underscores how the oil and natural gas industry can enhance America's energy security and help solve our economic problems by increasing production of our nation’s vast oil and natural gas resources," said API President and CEO Jack N. Gerard. "The U.S. oil and natural gas industry supports more than nine million jobs, and more drilling for oil and natural gas will mean more energy for America, more well-paying jobs, and trillions of dollars of much-needed revenues that will help federal, state and local governments pay for critical services."
According to the ICF study, U.S. crude oil production would rise by 36% by 2030 if development is permitted in the studied areas of the Outer Continental Shelf, ANWR and the Rockies and domestic natural gas production would rise by 10%. By 2030, this activity would create 160,000 jobs.
Shale Gas
According to the Department of Energy, U.S. proven natural gas reserves rose 3 percent in 2008, and shale gas reserves rose an astonishing 51 percent over 2007. Successful production from shale formations such as the Marcellus Shale in the Northeastern United States is expanding our domestic energy resources and benefiting local economies.
According to the study, “The Economic Impacts of the Marcellus Shale: Implications for New York, Pennsylvania, and West Virginia,” by Timothy J. Considine, Ph.D. of Natural Resource Economics, natural gas production in the Marcellus Shale region—if developed—could create 280,000 new American jobs and add $6 billion in new tax revenues to local, state and federal governments over the next decade.
This expands on a study by Pennsylvania State University, which found that more than 211,000 new Pennsylvania jobs could be created over the next 10 years by developing the Marcellus region—a layer of shale rock underneath much of western Appalachia, from southern West Virginia into southwestern, central, and northeastern Pennsylvania, and the southern tier of upstate New York.
This significant uptick in job growth is attributable to the significant expansion in the amount of natural gas expected to be produced per day according to the updated study. In 2009, the same study forecast the potential for the Marcellus in Pennsylvania to produce 4 billion cubic feet per day; the May 2010 version suggests the actual production rate may surpass 13 billion cubic feet —seven times the amount that Pennsylvanians currently consume.
The study also suggests that the Marcellus Shale could be the second largest natural gas field in the world if fully developed, providing an amount of energy to American consumers equivalent to the energy content of 87 billion barrels of oil. For scale, the entire U.S. currently consumes seven billion barrels of oil a year, with Pennsylvania consuming about 253 million barrels of that.
Another study, sponsored by the Business Council of New York, projects that New York State will experience an annual economic uplift of $92 – $123 billion from the development of the Marcellus and Utica Shales. Researchers used data from the Barnett Shale in North Texas, specifically the ratio of annual economic uplift to wells drilled to calculate these figures. Marcellus-Utica development could also result in the creation of 800,000 jobs over the course of 30 years of exploration and production.