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New Study: Alabama benefits from natural gas use

Michael Tadeo | 202.682.8114 |

Montgomery, Ala., June 27, 2017 – The Alabama Petroleum Council today released a new study on the benefits natural gas brings to the state in terms of consumer savings, family-sustaining jobs and economic growth. The study shows that all 50 states benefit from natural gas produced domestically, including non-producing states.

“Beyond the obvious rewards of abundant clean-burning natural gas, Alabama receives substantial monetary and economic growth benefits as well,” said Executive Director Dean Peeler. “Hundreds of millions of severance tax dollars are paid yearly to the State by offshore producers. Ten percent of severance taxes go to our two coastal counties of production. And $3.6 billion in royalties from offshore production have been paid into a trust fund benefiting all Alabamans. Natural gas is produced safely from deep beneath Mobile Bay and the Gulf of Mexico, a clear "win-win" for Alabama.”

The study by ICF International examined the economic benefits and opportunities from the entire natural gas value chain, including the production of natural gas, its transportation and end uses like power generation and manufacturing.

Natural gas benefited Alabamans in 2015 in the following ways:

  • Supported 56,600 or 3 percent of jobs in the state 
  • Contributed $7.76 billion to the state’s economy

“From power generation for homes and businesses that benefit from affordable and reliable electricity, to the industry’s skilled workforce that produces natural gas, to pipelines and the workers who build them, the advantages of natural gas are wide-ranging,” said API President and CEO Jack Gerard. “With energy week in full swing, this study is another example of the job and consumer benefits of natural gas across the country.” 

The study found that consumers in all 50 states will save an estimated $655 by 2040 from natural gas production, transportation and other uses such as electricity generation.

Other report highlights on the benefits of natural gas production, its transportation and end uses throughout the value chain include:

  • By 2040, consumers across the country will save an estimated $100 billion, or $655 per household, from the increased use of natural gas throughout our economy – from manufacturing to generating affordable electricity. 
  • In 2015, the natural gas supply chain supported 3 percent of the U.S. economy, including direct, indirect and induced activities and jobs associated with natural gas. 
  •  In 2015, natural gas supported more than 4 million jobs across the country from production to end uses like manufacturing. That number is expected to rise to 6 million jobs by 2040.

The full study containing Alabama’s state specific information is available on API’s website.

The Alabama Petroleum Council is a division of API, which represents all segments of America’s oil and natural gas industry. Its more than 625 members produce, process, and distribute most of the nation’s energy. The industry supports 9.8 million U.S. jobs and is backed by a growing grassroots movement of more than 40 million Americans.