US government policies that encourage development of new and existing oil and gas resources could, by 2030, increase production by more than 10 million b/d of oil equivalent, support 1.4 million more jobs, and raise another $803 billion of government revenue, a study commissioned by the American Petroleum Institute concluded.
The Wood Mackenzie study also found that increasing regulatory burdens on domestic producers would raise development costs, which potentially could hinder production, tax revenue, and job growth.
“Continuing the current path of policies which slow down the issuance of leases and drilling permits, increase the cost of hydraulic fracturing through duplicative water or air quality regulations, or delay the construction of oil sands export pipelines such as Keystone XL will have a detrimental effect on production, jobs, and government revenues,” it said.
API released the study during a Sept. 7 Capitol Hill energy jobs summit it cosponsored with The Hill newspaper. API Pres. Jack N. Gerard referred to the study’s findings in a Sept. 1 letter to US President Barack Obama in which he urged Obama to include job-creating proposals available through producing more oil and gas domestically in his scheduled economic address on Sept. 8.
‘We can do more’
Gerard noted that the US oil and gas industry already supports 9.2 million jobs and generates more than $1 trillion/year of economic activity. “We can do more of both—and increase our revenues to the federal government—through common sense policies that promote development and production of our domestic resources and Canada’s oil sands, while protecting our national parks and fragile ecosystems,” Gerard said in his letter.
The WoodMac study said favorable policies could add more than 1 million new energy jobs by 2018. “Policies that increase access to currently undeveloped regions have the largest potential to create new jobs in the US, an estimated 690,000 new jobs by 2030,” it indicated.
While API commissioned previous studies to examine government permitting policies and possible benefits of opening specific geographic areas for leasing and development, this was the first to comprehensively address benefits of favorable policies and regulations, Kyle Isakower, API’s vice-president for regulatory and economic policy, said on Sept. 6. “With the exception of opening the eastern Gulf of Mexico, these are all policies the president could enact on his own without any congressional approval,” he told OGJ.
Scheduled speakers at the Sept. 7 energy jobs summit, in addition to Gerard, included US Sen. Ben Nelson (D-Neb.), US House Natural Resources Committee Chairman Doc Hastings (R-Wash.), and Chevron Corp. Chief Executive Officer John S. Watson.
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