IHS, in a study published on what it says is the new American future, finds that the upstream unconventional oil and natural gas sector in the United States could support as many as 3.5 million jobs by 2035. In terms of revenue, that translates to as much as $124 billion for federal and state government revenues by 2035. For reserves, IHS expects a transformation in the U.S. energy sector, where as much as 70 percent of total U.S. oil production is expected to come from so-called unconventional tight oil reserves.
Daniel Yergin, the author of the study, said the United States has the highest growth rate in crude oil production capacity in the world.
“That growth has not only contributed to U.S. energy security but is a significant source of new jobs and economic activity at a time when the economy is a top priority,” he said in a statement.
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In its first estimate of the Utica shale play in Ohio, the U.S. Geological Survey found the formation could hold as much as 38 trillion cubic feet of recoverable natural gas and 940 million barrels of oil. The Utica play lies underneath the Marcellus formation, which is thought to be one of the richest deposits of natural gas in the world.
“The study highlights the extraordinary opportunities we have right here at home to develop our unconventional oil and gas resources and return our economy to a pro-growth engine,” said Jack Gerard, president of the American Petroleum Institute.
A recent independent survey of Ohio legislation, however, found the state is one of the least transparent in terms of energy reporting. Analysts said the lack of third-party assessments has given potential investors cause for concern. An economist from Ohio, meanwhile, said long-term cycles in resource-rich states are “a little scary” for the state. Though landowners there are getting rich by leasing their property to prospective oil and natural gas developers, future prospects may eventually dwindle once wells there dry up. States with natural resources, the economist said, usually underperform when compared with their counterparts with no natural resources.
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Technological advancements in oil and natural gas exploration have uncovered reserves previously considered off limits. These advancements, in turn, may transform the United States into something of a petroleum state on par with the likes of Saudi Arabia. A report from Citibank stating that Riyadh may eventually start importing oil in the next 20 years, however, serves as a stark reminder that resources like oil and natural gas aren’t renewable. While the oil and natural gas boom in the United States may last a generation, every well, no matter the prospects, dries up.