As prepared for delivery
John Felmy, API Chief Economist
Remarks on the Importance of Shale Energy to America’s Future
October 4, 2012
The development of shale natural gas and oil through the use of hydraulic fracturing has a long history in this country. In recent years, the application of horizontal drilling has allowed hydraulic fracturing to access enormous, previously unreachable, supplies of oil and natural gas – and to do so safely and responsibly.
It was these technological achievements that led to what is known as the “North Dakota Miracle,” which has transformed that state into our nation’s No. 2 oil producer, reduced unemployment there to 3 percent and driven incomes up sharply. And it has seen the state’s treasury accumulate a billion-dollar surplus.
It is these same technological advancements that have created tens of thousands of new jobs and generated billions in new state revenues in Pennsylvania, Texas, Arkansas, Louisiana, Ohio and other states. And it is these technological feats that account for the oil and natural gas industry’s having added more than 100,000 jobs to our economy since the recession began – and four times that many indirect jobs – while total non-farm jobs across the nation are down by about 5 million.
Poll after poll has found that the American people support greater domestic energy production – and those same polls show a clear recognition that doing so could lead to more jobs, greater U.S. energy security and fewer imports. And that is why policymakers at all levels of government – from the president to governors to local officials – are standing firm in support of shale oil and natural gas development in this country.
We’re hopeful that Governor Cuomo too will soon allow New York to join the growing list of states reaping the benefits of developing energy from shale. Polls show a large majority of New Yorkers believe that oil and natural gas development in New York will create jobs.
Similar views are held by Americans across the country, and that is why forward-looking policymakers in states across the country are working to develop these resources safely and responsibly. They are part of the commendable, comprehensive and effective state oversight and regulation of hydraulic fracturing.
America’s oil and natural gas industry has worked hard to increase awareness of the progress and potential of shale energy development. API and the industry it represents take pride in the role we play in ensuring safe operations in every segment of the industry, from transportation to refining to retail distribution, and especially in drilling and well completions, through the development of industry standards and best practices.
Since 2009, API has published five standards specific to hydraulic operations. These include standards for:
- Well construction and integrity;
- Water management;
- Mitigating surface impacts;
- Environmental protection for onshore production operations and Leases; and
- Isolating potential flow zones during well construction
Each of these documents plays an important role in ensuring safe and environmentally sound operations. We work within industry and with government regulators to ensure our standards, guidance documents and best practices are widely used, which is why API standards are frequently cited in state and federal regulations. The HF-specific documents are available on-line for free.
We have also conducted workshops and training sessions on these standards for state officials in New York, Pennsylvania, West Virginia, Ohio, and several other states in shale rich areas across the country.
The PowerPoint presentations from these workshops are available on the www.energyfromshale.org website and our HF Standards and guidelines – along with other information – are available in the hydraulic fracturing section of API.org.
Given the heightened interest in these standards, we have included the standards on well construction and integrity, water management and mitigating surface impacts as part of our 2012 standards plan. We remain committed to safe and responsible development of our shale energy resources and to working closely with the states to ensure effective, appropriate regulation.
Because as we prepare to take advantage of the enormous opportunity provided by abundant, affordable, domestic energy resources, we must also ensure that unnecessary or duplicative regulations don’t impede the very investments we need to create jobs, grow the economy and secure our energy future.