Resisting resource development stifles big source of jobs

Jan. 30, 2012
What does US President Barack Obama have against employment related to resource development?

What does US President Barack Obama have against employment related to resource development?

Days after the president refused to approve the Keystone XL pipeline and jobs promised by its construction, the American Petroleum Institute published a study estimating employment penalties from his administration's foot-dragging on federal land.

The study, by EIS Solutions of Grand Junction, Colo., cites Bureau of Land Management numbers suggesting "a systematic decline of energy production activities on the nation's federal lands in the last 2 years."

Between 2007-08 and 2009-10, the average number of leases issued in five western producing states fell 44%. Permits and wells drilled fell 39% each.

Recession doesn't fully explain the declines. Activity on nonfederal land was down far less.

Much of the declines resulted from federal land management characterized since Obama took office in January 2009 by an aversion to oil and gas leasing, slow permitting, and new rules creating new delays.

With economic modeling, the EIS study estimates the consequences of returning to the permitting, leasing, and drilling levels of 2007 and 2008.

Production of oil, gas, and gas liquids obviously would increase. So would tax and royalty payments. And so would jobs.

Relative to baseline projections, the study estimates direct employment gains from the higher levels of energy activity in just the five states at 4,085 jobs in 2011, rising to a peak of 9,937 jobs in 2013. Total employment gains throughout the economy would rise from 12,656 in 2011 to a peak of 30,163 in 2013.

Opponents of oil and gas work will reject these numbers, as they did with jobs forecasts related to the Keystone XL pipeline between Alberta and the Texas Gulf Coast. After Obama refused to approve the project, activist groups called industry job forecasts "wildly exaggerated," even "lies."

But employment isn't about the elusive precision of forecasts; it's about jobs. Resource development creates jobs, lots of jobs, whatever the numbers.

Opponents to resource development stifle employment. And Obama helps them every way he can.

More Oil & Gas Journal Current Issue Articles
More Oil & Gas Journal Archives Issue Articles
View Oil and Gas Articles on PennEnergy.com