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Oil industry study: Wider drilling would add 1 million jobs
A study commissioned by a major oil-industry lobbying group found that federal policies to expand oil-and-gas development could add 1.1 million U.S. jobs over the next decade and bring in $36 billion in federal revenues by 2015.
“We can be a major driver in the economic recovery and we stand ready to do so,” said American Petroleum Institute (API) President Jack Gerard in an interview about the study, unveiled Wednesday.
Gerard said API would ensure the study — performed by the consulting firm Wood Mackenzie — is circulated among policymakers, including the bipartisan supercommittee that’s meeting this fall to find $1.5 trillion in federal deficit reduction.
The study looks cumulatively at the effects of policies — some of which need congressional approval — that would loosen restrictions on U.S. drilling and other steps. It outlines a “development policy case” that includes opening up areas where drilling is now off-limits, including the Atlantic and Pacific Coast, Alaska’s Arctic National Wildlife Refuge (ANWR) and the eastern Gulf of Mexico.
The “development” case would also include expanded access in the Rocky Mountains, the National Petroleum Reserve-Alaska and off the coast of Alaska.
Other policies that the study models include allowing shale gas drilling in New York; faster permitting in the Gulf of Mexico, where leasing already occurs; federal approval for the controversial Keystone XL pipeline to link Canada’s oil sands crude to Gulf Coast refineries; and other steps.
Taken together, Wood Mackenzie estimates these steps would create roughly 1.1 million jobs by 2020, and produce an additional 1.27 million barrels of oil-equivalent (BOE) per day by 2015 and 4.19 million BOE in 2020.
Drilling advocates also tout revenue from royalties, leasing bids and other sources linked to development. The study estimates that the wider development API seeks would add $36 billion in new revenue by 2015 and $803 billion by 2030.
Several of the policies API wants face major political hurdles. The current Congress is highly unlikely to allow ANWR drilling, while the plan envisions vastly wider offshore leasing than the Obama administration is contemplating.
But Gerard said Obama should change course on oil drilling policy.
“The president has a lot of discretion at his disposal today to make some of these choices to jumpstart the economy and produce additional oil-and-gas jobs,” he said.
The administration could allow new leasing in many areas under its existing powers, while other regions — including ANWR and most of the eastern Gulf — would require congressional approval to develop.
