IHS Global Insight released a study showing that shale gas production will continue to grow and people employed in the shale gas industry will increase by 1 million by 2035. The study entitled “The Economic and Employment Contributions of Shale Gas in the United States” expects shale gas to represent 60 percent of total U.S. natural gas production by 2035, up from 27 percent in 2010.[i] Those numbers are staggering when as recently as five years ago, forecasters were predicting that the United States would need to import liquefied natural gas to meet its natural gas demand. Instead, if the government will permit it, the United States may export liquefied natural gas overseas due to its abundance and low prices.
More recently, IHS Global Insight released a companion study on the employment and economic impact of production of unconventional gas—shale gas, tight gas, and coal bed methane—finding that the unconventional gas industry supports over 1 million jobs today and is expected to support 1.5 million by 2015. That study included tight gas and coal bed methane, which with shale gas, accounted for 53 percent of total U.S. natural gas production in 2010; those sources are expected to account for 79 percent of total U.S. natural gas production by 2035.
The newer report, “The Economic and Employment Contributions of Unconventional Gas Development in State Economies”, examines unconventional gas activity in the lower 48 states: 20 producing states as well as its impact on 28 non producing states.[ii] Producing states are the states that have either new well completions and production or production from existing wells. Non-producing states are the 28 states and the District of Columbia that do not include current or projected unconventional gas resource development.
Shale gas is booming because technology (hydraulic fracturing and horizontal drilling) has made it economic to produce when previously it was inaccessible to production because it was trapped in shale rock through which gas would not readily flow. Its abundant supply has forced U.S. natural gas prices to drop below $2 per thousand cubic feet, making it an affordable fuel for manufacturers, who are moving back some of their operations from overseas.[iii] Today the price has increased a little to $2.19 per million BTU—one half of what it was a year ago.
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