The oil and natural gas industry is a major contributor to the American economy and helps meet America’s constantly increasing energy needs.
That’s a fact.
New studies project that offshore energy development would be an economic catalyst for the entire country; significantly increasing jobs, domestic spending, investments and state revenues.
That’s an aspiration – and, based on four regional studies API commissioned from Calash and Northern Economics, it’s achievable.
But with more than 94 percent of the total acreage in federal offshore waters currently inaccessible, there are challenges ahead. They’re worth overcoming.
Opening the U.S. Outer Continental Shelf (OCS) to safe and responsible offshore energy development would advance the American energy renaissance with positive impacts on salaries, investments in local communities, additional state revenue for public education and infrastructure and long-term energy self-sufficiency.
In the Atlantic OCS alone, total spending by the oil and natural industry over the first 20 years of development could reach $260 billion and grow to an annual rate of over $20 billion per year, supporting 265,000 jobs across the nation. Production is projected to be over 250,000 barrels of oil equivalent per day within three years of initial production, rising to over 1 million barrels per day of oil equivalent within eight years.
As for the Pacific OCS, total spending by the oil and natural industry over the first 20 years of development could reach $160 billion growing to $25 billion spent per year by the natural gas and oil industry. Such activity would support 300,000 jobs in the US.
Looking south, projected total spending for the Eastern Gulf OCS by the oil and natural industry over the first 20 years of development could reach $118 billion and grow to an annual rate of over $14 billion per year of industry spend. This would support nearly 165,000 jobs across the nation.
And finally, OCS Alaska’s projected spending is $53.4 billion over 20 years, with about $2 billion spent on average per year by the oil and natural gas industry. This would support up to about 13,500 jobs per year across the nation over the twenty-year period.
We at API recently made these figures available for the discussions about the US Department of the Interior’s five-year National OCS Program – a good first step in the right direction of continuing America’s energy renaissance.
We have also gone on record in favour of the unprecedented and historic U.S. tax reform that will support our energy renaissance, jobs, and world-class infrastructure. All of that is helping to advance offshore energy exploration and production.
Such progress is part of a responsible pathway for the U.S. to harness its full energy potential and to meet U.S. long-term energy needs. As the studies I’ve cited have found, opening the OCS will bring economic benefits to local communities across the country for decades to come.
About Erik Milito
Erik is director of upstream and industry operations at the American Petroleum Institute.