America is on course to become an energy superpower. Once our greatest economic vulnerability, we have transformed energy into a source of immense strength.
The surge in natural gas production in the Marcellus Shale is evidence of this transformation. We can be the world’s energy leader if we get energy policy right.
Today, we have before us a once in a lifetime opportunity to reshape our energy future and significantly improve our economy. Taking full advantage of our vast energy potential means crafting policies that encourage new production and reflect this new era of energy abundance.
The United States already is the world’s biggest producer of natural gas, and the U.S. Energy Information Administration projects that we will soon surpass Saudi Arabia as the world’s largest producer of oil. Consider that, as recently as 2005, imported oil accounted for 60 percent of our supply. But the ramp- up in U.S. energy development — production of crude oil and natural gas liquids has grown by more than 2 million barrels per day in the past two years — has imports free-falling. Within two years, imports are projected to make up just 25 percent of our supply.
Pennsylvania exemplifies what the shale revolution has meant for our economy. Thanks to the innovative combination of hydraulic fracturing and horizontal drilling, natural gas production in the Keystone State grew by 72 percent from 2011 to 2012 — the fastest-growing rate of production anywhere in the country. Little more than an economic afterthought just a few years ago, unconventional energy development now supports more than 100,000 jobs in Pennsylvania.
Across the state, the shale revolution has brought jobs and investment to communities that desperately need both and those benefits haven’t been limited just to parts of the state producing energy. In Philadelphia, for example, a refinery on the verge of closing is now expanding its operations thanks to the availability of lower-cost domestically produced oil. The expansion is helping to save 850 existing jobs and add 200 more.
Energy development in Pennsylvania has delivered hundreds of millions of dollars in revenue to government coffers. Between 2012 and 2013, the natural gas industry paid more than $400 million into the state’s Unconventional Gas Well Fund. That revenue is supporting local housing initiatives, road and bridge improvements as well as environmental programs.
And natural gas production is producing environmental gains, as well. Increased use of natural gas for electricity generation has helped drive the nation’s CO2 emissions to their lowest level in nearly 20 years.
The benefits of our shale revolution are impressive but they didn’t happen by chance. Smart policy provided the opportunity for American ingenuity to unlock our vast shale reserves, and it wouldn’t have happened without political leadership from within Pennsylvania. Look no further than New York to see how misguided policy has prevented the enormous benefits from shale production reaching more people.
Energy matters. Today, the oil and natural gas industry supports 9.8 million American jobs, is encouraging a manufacturing renaissance and has us on track toward energy self-sufficiency. The rest of the world is in awe of the technological leadership that has produced our shale revolution and is trying to emulate it. By changing the energy calculus, we have accomplished what many believed to be beyond our reach.
We now face a choice: We can move forward and craft pro-development policies that allow us to take full advantage of our enormous resources, or we can fall back and relinquish world leadership. We owe it to future generations to continue forward.
Jack Gerard, president and CEO of the American Petroleum Institute, will be speaking at a World Affairs Council event in Pittsburgh Wednesday at noon. For more information: www.worldpittsburgh.org.