WorldWide Drilling Resource

33 WorldWide Drilling Resource ® OCTOBER 2013 America’s Natural Gas Industry ~ A REAL Stimulus Plan Adapted from a Press Release by IHS Global Insight Natural gas production from shale, coalbed methane, and tight sands is ex- pected to generate significant job cre- ation, economic growth, and revenue for federal, state, and local taxes throughout the U.S. in gas producing and nonproduc- ing states alike, according to an IHS Global Insight study. Unconventional gas activity support- ed more than one million jobs in 2010, and it will grow to support nearly 1.5 million by 2015, according to the study. The Economic and Employment Contributions of Unconventional Gas Development in State Economies exam- ines unconventional gas activity - a grow- ing subset of the total natural gas industry. The report found substantial growth in jobs and economic activity in unconven- tional plays over the past decade. IHS Vice President John Larson, lead author of the study said, “At a time when the U.S. economy is slowly recov- ering from the Great Recession and struggling to create enough jobs to sharply reduce the unemployment rate, the growth in shale and other unconventional natural gas production is a major contributor to employment prospects and the U.S. economy. As this report makes clear, these benefits spread beyond producing states to deliver positive impacts across the country.” Between 2010-2015, the top ten producing states (as ranked by uncon- ventional gas-related employment) were Texas, Louisiana, Colorado, Pennsylvania, Arkansas, Wyoming, Ohio, Utah, Oklahoma, and Michigan - will experience a compound annual job growth rate of nearly 8%. Pennsylvania and Colorado are expected to lead those rates at 14% and 10%, respectively. Meanwhile, total U.S. employment is ex- pected to grow at a significantly lower average rate of 1.6% during the same period. Of the nearly 1.5 million unconven- tional gas activity jobs contributing to the economy by 2015, nearly one-fifth are projected for nonproducing states. The top ten nonproducing states (as ranked by jobs growth due to unconventional gas development) in 2015 are projected to be Cal ifornia, Florida, Georgia, Missouri, North Carol ina, Indiana, Wisconsin, Minnesota, Tennessee, and Maryland, supporting the industry through the extensive supply chain and service jobs necessary to support development. “When it comes to unconventional natural gas, a state does not need to have a gas play to benefit economically,” Larson added. Among the study's other key find- ings: $ Unconventional gas activity account- ed for 53% of total U.S. natural gas production in 2010, and is projected to rise to 79% of total U.S. natural gas production by 2035. $ Nearly $3.2 trillion in cumulative investments in the development of unconventional gas are expected to fuel the increase in production between 2010 and 2035. $ By 2015, the annual contribution of unconventional gas activity to U.S. gross domestic product is projected to reach nearly $197 billion, more than $22 billion of which will be from non- producing states. In total, the annu- al contribution is expected to more than double by 2035 to almost $332 billion. $ Government revenue from uncon- ventional gas activity is projected to reach more than $49 billion annually by 2015 and will continue to rise to just over $85 billion by 2035. Over the study's entire 25-year horizon, unconventional gas is expected to generate nearly $1.5 trillion in total government revenue. -32* &; = 3'.0* 1&.0 /('.768440< <&-33 (31 &00 86 35 9.6.7 86 &7 .57 .,,*5 2*: &2) 86*) '. 76 1&7 5 .; &2) 67**0 '3)< 7 0 & 6 3 4 ( 3 :35/39*5 7337- &2) '87732 '.76 *&5 0&: 855.(&2* &2) -314 1. 0 06 +35 (*1*27 1*7&0 &2) (31436.7* 408,6 5&, '.76 &2) /*00< '.76 !$" ! % # ! ! #