Outlook
into shale gas development, and the pace of effort intensified. Since then, output has grown rapidly, indeed well beyond the capacity of the current market to absorb it. It was not until the autumn of 2009 that the shale revolution became apparent to the policy community. And it was only around 2010 that producers began to shiſt from focusing on gas production to produc- ing oil and liquids-rich natural gas using the same techniques.
The Economic Impact While various states
had begun to home in on the economic development aspects of shale gas and tight oil, it was only in about 2011 that its significance for the national economy started to come into focus. So far, this unconventional revolution is supporting 1.7 million jobs—direct and indirect. It is notable that, owing to the long supply chains, the job impacts are being felt across the United States, including in states with no shale gas or tight oil activity. For instance, the state of New York, which presently bans shale gas development, nevertheless has benefitted with 44,000 jobs. Illinois, debating how to go forward, already registers 39,000 jobs. Te total revenues flowing to
scoffed if they had been told that they would be investing back into the US. Te investments are coming both from US-based companies, which are “on- shoring” in response to lower energy
this degree of intensity in regions that are more densely populated and that are not accustomed to oil and gas de- velopment. Understandably, the envi- ronmental impacts need to be carefully assessed and monitored, and the public needs to be confi- dent about these impacts. In March 2011, Presi-
Despite having large natural gas reserves, the US still imports a fair share.
costs, and from foreign companies. Many other kinds of manufacturing firms are also investing and expanding based upon this growing business.
governments from unconventional gas and oil amounted to $62 billion last year. Companies are now commit- ting or planning investments that in total appear to go into the hundreds of billions of dollars. A large number of chemical companies, for instance, have announced plans to build or expand facilities in North America—with capi- tal expenditures totaling close to $100 billion. Will all be built? Time will tell. But what is striking is that, half a de- cade ago, these companies would have
18 Energy Manufacturing 2013
The Environmental Impact How to assess the environmental
aspects? Te most notable impact is in terms of CO2 emissions. US carbon dioxide emissions from energy con- sumption are down 13% since 2007. Te economic downturn is part of the story. But the most significant part is the result of natural gas supplanting coal in electric generation at a rapid rate. Hydraulic fracturing has only been recently applied at this scale and with
dent Obama spoke about how “recent innovations have given us the opportu- nity to tap” large reserves of natural gas—“perhaps a century’s worth of reserves.” But he added that the public needs to be assured that it is being produced safely. As a consequence, a subcom- mittee to the Secretary of Energy’s Advisory Board was established to examine the environmental questions. Its work identified three major environmental issues—wa- ter, local air pollution, and community impact. Each, the subcommittee concluded, needs to be managed with great attention and that can be achieved through best practices in operations and regulation, continuing tech- nological innovation, and community engagement. We
see continuing effort going into these endeavors—with, for instance, recy- cling of water and new approaches to wastewater treatment. One observation that came out of
that study is what seems to be a mis- match between perceptions of regula- tion and actual regulation. Drilling is a highly-regulated activity, but it is mostly regulated at the state level. We identified the need to continue to support, with what amounts to very small funding, the activities of STRONGER—State Review of Oil and Natural Gas Environmental Regulations—a collaborative bench- marking and standard-setting orga- nization that evaluates and promotes
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