June 20, 2013 12:05 am  •  By DAVID L. TYLER

If you’ve been caught off guard by the shale energy revolution, you’re not alone. Surging U.S. natural gas production and booming oil production from shale formations have given even mighty OPEC whiplash. U.S. imports of oil have dropped dramatically – they’re at their lowest point in more than 20 years – and are headed even lower.

This surge is creating jobs and wealth that didn’t exist before, even in states where there has been no production. These states are benefiting from a rebound in manufacturing of steel pipes, concrete and other products used in oil-and-gas production.

The boom in shale production comes from a combination of technologies – horizontal drilling and hydraulic fracturing, which involves pumping water and sand, with trace amounts of chemicals, at high pressure to break apart underground rock formations. Largely due to fracking, the amount of technically recoverable oil-and-gas reserves today is 35 percent greater than in 2011. This gives our country greater defense against overseas turmoil that can disrupt energy supplies.

Consider the impact of the shale revolution on some OPEC producers, like Nigeria and Angola. U.S. imports of Nigerian and Angolan crude, totaling more than 2.5 million barrels per day just five years ago, have been cut in half. And Saudi Arabia has cut its oil production in an effort to prop up global prices. The increase in U.S. oil production is blunting the impact of rising Asian demand for oil, primarily from China, which has been the key driver of global oil prices over the past decade.

The U.S. shale revolution has the world’s attention. And yet, we’ve only begun to realize the full promise of our vast shale resources. For example, California’s untapped Monterey shale formation is believed to hold 15.4 billion barrels of oil, two-thirds of the nation’s shale oil reserves, according to the U.S. Energy Information Administration. Our oil reserves and production are growing from day to day.

The world’s energy needs are expected to grow tremendously over the next few decades, and in order to help meet them, the United States is going to have to become an oil exporter.

We already export coal, and the Obama administration has recently expressed support for expanding the export of liquefied natural gas. Now is the time to reverse the 1979 ban on crude oil exports, which could hamstring domestic production. The ban prohibits the sale of crude oil to any country other than Canada and Mexico.

The shale revolution has already created 1.7 million new jobs and has the potential to create another 3.5 million by 2030. Those job gains, and tens of billions in new wages and new tax revenues, are predicated on the expansion of U.S. energy production.

Every new well drilled pushes millions of dollars into the economy. That investment pays for millions of pounds of cement and steel, rig crews, truck drivers, and environmental monitoring. The potential exists for tens of thousands of new wells to be drilled every year for the foreseeable future. But failure to allow exports could artificially restrict that potential and lead to the loss of jobs and billions of dollars worth of economic opportunity.

The United States already allows the export of refined petroleum products, such as gasoline and diesel. It’s time we do the same for crude oil. The 1979 ban on crude exports was an understandable response to the 1973 oil embargo and the Iranian revolution. But the age of U.S. energy abundance has arrived and we should shape policies to reflect it.
 


Comments

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I think this news isn't new for the visitors who are living in US that The United States already allows the export of refined petroleum products, such as gasoline and diesel.

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03/07/2017 4:16am

Surging U.S. natural gas production is continuously drooping day by day. Your article explain many things about this fact. Thanks for Sharing your information with us.

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