Feb
26
The Economic Impact of the Oil and Natural Gas Industry
February 26, 2010 | 13 Comments
While I’m under the weather Jane Van Ryan has graciously provided content for today.
Jane Van Ryan Center, left is Dave Sykuta of the Illinois Petroleum Council, and on the right is Bill Stephens of ConocoPhillips. The location is a recovered oil sands site.
For many years, this nation has been debating its energy future. Speeches have been made and legislation has been passed, but on balance the United States is less energy secure today than it was 35 years ago after the oil embargo. Why? Because the rhetoric has not matched the reality of the nation’s energy challenges.
Let’s look at the facts. Oil and natural gas are the foundation of the U.S. economy. They affect how we live and work; they are the key to our transportation system; and they supply the raw materials for countless consumer and industrial products.
Today, oil and natural gas supply 63 percent of the nation’s energy and represent more than $1 trillion of U.S. economic activity, accounting for about 7.5 percent of U.S. GDP, helping to make the U.S. economy the biggest in the world. Oil and natural gas also support about 9.2 million American jobs. Between 2004 and 2007, the industry also created more than two million additional American jobs.
To prepare for the future, this nation will need to develop a broad portfolio of energy resources to meet its energy needs. This increasing energy diversity will include alternatives and renewables as well as oil and natural gas. And today’s energy companies are investing in the fuels of future. Between 2000 and 2008, the industry invested more than $58 billion in carbon mitigation technologies and similar projects, more than either the federal government or other private industries combined.
But the fact remains that oil and natural gas will be the bulwark of our economic system for many years to come and will continue to be integral to its long-term progress. Every credible projection shows that oil and natural gas will have critical roles in the future. The U.S. Department of Energy forecasts that oil and natural gas will supply more than one-half of the nation’s energy in 2030.
To meet the future energy challenge, this country must explore for and produce more domestic oil and natural gas. By making more of the nation’s own energy resources available, the United States could become more secure, reduce the deficit, and give a much needed boost to the economy. A recent study conducted by ICF International found that allowing energy development on areas that have been off-limits could create hundreds of thousands of jobs, generate about $1.7 trillion in revenues for federal, state and local governments, and help to lift the United States out of the worst recession in decades. And this boost to the economy would not require a stimulus plan, an earmark or a handout from American taxpayers.
The newly created jobs also would give another generation of Americans the opportunity to experience the American Dream. Jobs in the exploration and production sector of the industry pay more than twice as much as the national average. They also encourage the development of a workforce grounded in science and technology, capable of advancing human knowledge, making new discoveries, and helping to keep America competitive globally.
A survey conducted in 2008 found that North America is not producing enough graduates in geology, geophysics and petroleum engineering to fill the positions that are expected to be available. The survey also found that about 7,500 employees are retiring from the energy exploration and production sector each year and another 2,000 are leaving the industry or moving from technical positions to management jobs. Filling these positions as well as the new ones created by expanding domestic oil and natural gas development could go a long way toward putting America back to work.
Polls show that Americans are aware of the economic benefits provided by oil and natural gas. They know the United States needs a sensible energy policy. And they acknowledge that today’s oil and natural gas industry can produce energy and protect the environment.
If the United States is serious about planning for its energy future, about creating new jobs and offering opportunities to the next generation, and about improving the economy, it should consider the reality of our energy situation and reject the flawed rhetoric of the past.
Oil and natural gas development play a huge role in the American way of life today and will continue to do so in the future.
Jane Van Ryan
Senior Manager, Communications
American Petroleum Institute (API)
Check out our blog at http://blog.energytomorrow.org/
Comments
13 Comments so far
Feedburner
Reddit
Stumbleupon
How can we create 1 million good high paying American jobs?
Drill for our own gas and oil.
Seaside communities could benefit most. And, these jobs would pay much more than tourism jobs like maids, grocery sackers and waitresses.
[…] the rest here: The Economic Impact of the Oil and Natural Gas Industry | New … Share and […]
Yes, all true. But the message is much too sensible for the current US government. They are deep into energy starvation as a tool of change.
That means that by the time a government is elected that sees the sense in drilling and developing solid energy resources, there will be no trained personnel ready to take on the job.
[…] The Economic Impact of the Oil and Natural Gas Industry | New … […]
The market will soon get it, you will soon get it, we all will. We already have the solution and it’s silently hissing into your house (hopefully on purpose). Natgas can and should be the ‘fuel of the future’ as many homes already have this infrastructure, it’s clean-burning, and we have 300 years of it. Who needs electric cars with sub-100 mile ranges? Why not hybrids which are a much more efficient use of lithium and natgas range extenders?
They use natgas in Cambodia and just pop a new tank in the trunk. It’s cheap and you have a filling station in your house already just like electricity but without the $10k battery.
Brian – Thank you so much for giving me the opportunity to share my thoughts here. As a long time fan of New Energy and Fuel, I appreciate having the chance to contribute.
Matt – Great point about the quality of oil industry jobs. Industry jobs tend to pay much more than the national average, and today the industry supports 9.2 million jobs – more than the populations of 15 states. (http://energytomorrow.org/Industry_Jobs.aspx)
John – You are correct that natural gas will be a primary component of this nation’s energy future for many, many years – and will likely play an even greater role moving forward. This makes the debate about hydraulic fracturing and how we access natural gas even more critical.
I’ve enjoyed reading your comments and I hope you’ll join the discussion at blog.energytomorrow.org, too.
Jane Van Ryan | American Petroleum Institute
Let me repeat my previously posted suggestions on the U.S. Energy Policy:
Any viable U.S. Energy Policy for the next few decades must include a combination of:
1. Consumption, Conservation and energy efficiency
2. Fossil Fuels-Oil, natural gas and coal
3. Nuclear
4. Renewables-wind, solar, ocean, biofuels, etc.
5. Geothermal, hydro, etc.
True enough, US need to develop a more balance and diversified energy portfolio rather than relying only oil and gas industry.
But, having said that, Obama government has committed to another oil and gas drilling endeavour in East Coast.
How do you see them ?
An economy stimulus or
another energy balancing guess ?
Well, both you and me would have the answers.
End of the day, Politic and Economy Situation will dictate all.
This article speaks volumes. We need to diversify our energy resources just like any thing else. A great way to remain safe in the stock market is to diversify. This philosophy applies to energy consumption just as much as any other industry. Hypothetically, if oil just disappeared or became obsolete, we would be in trouble. As a society, we should try and make our energy consumption more diversified.
A topic near to my heart thanks, I’ve been wondering about this subject for a while.
I liked seeing this, needed some more images though.
giving outexcellent in order. Your website is very cool. I am inspired through the details that you have on this site. It reveals how well you understand this business. Bookmarked this web page, will come back for extra writing.
I read your whole post and I would like to say that your there are some useful info in it thanks for sharing keep it up!!!