U.S. EIA forecasts growing domestic natural gas supplies – and Americans will benefit

When the U.S. Energy Information Administration (EIA) released its Annual Energy Outlook 2011 last week, growing U.S. shale gas production was the major headline.

The upswing of natural gas in general is good news for several reasons: It’s a cleaner-burning fuel for power generation, resulting in up to 60 percent less carbon dioxide emissions than coal; the abundance of domestic gas supplies helps strengthen U.S. energy security; and growing gas production means more jobs and economic activity in states across the U.S.

But if you go back only five or 10 years, few would have been talking about these benefits of domestic supplies of natural gas. That’s because even though industry experts knew for many years that the U.S. contains large supplies of natural gas trapped in hard, dense shale formations, they didn’t have the technology to access it in a cost-effective way.

Today, thanks to recent technological advancements, we can safely and efficiently access these enormous natural gas supplies. And the size estimates of the U.S. shale gas resource base continue to grow.

According to the EIA, an arm of the U.S. Department of Energy, the “technically recoverable unproved shale gas resource is 827 trillion cubic feet,” which is 480 trillion cubic feet larger than the EIA’s estimate in its 2010 outlook.

To put such figures in perspective, consider that estimates based on previous EIA data indicate that the U.S. contains about 100 years of domestic natural gas supplies at current demand levels.

With this growth in supply comes growth in employment and economic activity. According to a recent report from the Center for Strategic and International Studies, U.S. employment in natural gas rose 17 percent from 2006 to 2008, representing one in four net new jobs created during that time throughout the economy. Additionally, the natural gas industry supports an estimated 2.8 million U.S. jobs, and more than 30 states are home to 10,000+ natural gas jobs each.

The key to taking advantage of this abundant, cleaner-burning fuel is promoting policies that not only allow safe production of natural gas, but also enable it to compete on a level playing field. It’s important to note that this resurgence of U.S. natural gas supplies isn’t supported by government subsidies or mandates; it’s supported by advancements in technology that simply make it competitive in the marketplace. But that’s only the case when government policies don’t pick winners and losers by artificially supporting other fuels through long-term subsidies.

I talked a little about natural gas policy options on the blog earlier this year, but you can learn more in API’s “Freeing Up Energy” brochure. In just a few weeks we’ll also be releasing ExxonMobil’s annual Energy Outlook, which contains more information about the growth of natural gas.


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