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Jack Gerard's remarks to the American Association of Blacks in Energy

As prepared for delivery

Jack N. Gerard
American Association of Blacks in Energy
2015 Energy Summit
February 26, 2015

Thank you, Al, for that kind introduction and for the opportunity to speak this morning. I also want to thank the members of the American Association of Blacks in Energy for your rich heritage of leadership on energy policy and for helping to advance workplace diversity within the energy sector, and for all that you continue to do for the oil and natural gas industry.

Today, the United States is first in natural gas production, petroleum refining, and soon to be the number one producer of crude oil as early as sometime this year, with some projecting we are already there.

Take a moment to think about that: The United States IS the leader in natural gas production and a leader in crude oil production.

Not Saudi Arabia, not Russia…the United States of America.

In a few short years, we have surpassed all expectations and achieved a level of domestic energy production that was unthinkable even five years ago, which signals that this nation has entered into a new era I call the American moment.

Globally, this American moment has added significantly to the worldwide energy supply that has led to reduced energy costs, which benefit America’s consumers.

According to a Goldman Sachs economic analysis, the 60-cent drop in the price of a gallon of gas by the end of 2014 had the equivalent economic impact on the United States’ economy of a one-time tax cut of between $100 billion and $125 billion.

Another study estimates that for every 1-cent drop in the retail price of gasoline for a year, American consumers save $1.2 billion.

Nationally, America’s oil and natural gas industry supports approximately $1.2 trillion in U.S. gross domestic product and provides $85 million a day to the federal governments in the form of royalties, bonuses paid at lease sales and taxes.

And the industry supports 9.8 million jobs, 5.6 percent of total U.S. employment.

And while the recent swings in the price of oil have led to some restructuring in the oil industry, including some layoffs, this is not the long term story or trend for the industry.

The reality is, North American energy production is expected to increase for many years to come and as a result, so is the number of jobs available within the industry.

Today, we stand at the nexus of two dramatic changes to our country; first an unprecedented energy boom. Second a significant demographic change toward an even more diverse society.

This confluence means that in the coming decades, in order to fill the hundreds of thousands of jobs the industry will create, we’ll need to ensure that the oil and natural gas workforce of the future is as diverse as our nation.

To achieve that goal we need to understand where we stand now.

As the national trade association representing America’s oil and natural gas industry, we understand the need to ensure that tomorrow’s workforce is diverse.

Because, not only is it the right thing to do, it is a long-term business imperative.

The employment and demographic trends make it clear that in order to sustain our nation’s global energy leadership created by the North American energy renaissance we need an “all hands on deck” approach to recruitment and retention of the next generation of oil and natural gas workers.

And that means we’ll need higher levels of participation by women and minorities.

To get a handle on the industry’s future workforce – and what that means for women and minorities – API commissioned IHS Global to examine potential job opportunities through 2030.

The report, “Minority and Female Employment in the Oil & Gas and Petrochemical Industries,” estimates that over 950,000 job opportunities could be created by 2020 and nearly 1.3 million job opportunities through 2030 across the country in the oil and natural gas and petrochemicals industry.

In addition to these new jobs, there are a significant number of existing jobs that will need to be filled as a result of the expected “crew change,” a 7 to 10 year period when roughly half of the oil and natural gas industry’s technical personnel will retire.

The overarching message of the report is that if our nation is to fulfill its potential as a global energy leader the oil and natural gas industry must remain focused on attracting and retaining workers, management teams and senior executives that reflect the growing diversity of our nation.

Nationally, the report projects that, on our current course, almost 408,000 positions of the 1.3 million opportunities -- roughly one-third of the total expected growth -- will go to African American and Hispanic workers.

Women are estimated to fill upwards of 185,000 of those jobs.

African Americans are expected to account for 8 percent; Hispanics 24 percent and women 15 percent of total job opportunities in our industry.

The report also estimates that African American and Hispanic workers are projected to make up nearly 20 percent of new hires in management, business, and financial jobs through 2030.

And keep in mind that these estimates are based on current and projected trends in factors such as labor force participation rates and educational attainment. We should consider these projections more as a floor, not a ceiling.

The report emphasizes the fact that in the decades ahead the oil, natural gas and petrochemical industries will spur the creation of hundreds of thousands of new, well-paying jobs that require people with a wide range of skill sets, training and educational achievement levels.

To maintain success we need a workforce prepared for the thousands of well-paying career opportunities our industry will create with the right energy policies.

The report also was a wake-up call for our nation and our industry when it comes to the difference between the current levels of educational attainment in Science, Technology, Engineering and Math or STEM subjects and what will be needed in the years ahead.

In the past decade or so, the United States has slipped relative to other developed nations when it comes to producing college graduates with degrees in science and engineering.

According to the Organization for Economic Cooperation and Development, the United States ranks 27 out of 34 developed nations in the proportion of college students receiving undergraduate degrees in science or engineering.

Last year API concluded a ten city tour that highlighted the career opportunities in the oil and natural gas industry that attracted thousands of people and many local partners who now have a better understanding of the career opportunities available within the oil and natural gas industry.

The ten city tour also emphasized ways in which local communities can put into place education policies that emphasize, promote and encourage STEM education regardless of geography, socioeconomic circumstance or demographic group.

Bottom line, we need to increase the number of STEM graduates to ensure that we have a workforce capable of continuing America’s 21st century energy renaissance and global energy leadership.

And in that area we have some work to do.

For example, between 2003-2012, women earned 58 percent of all bachelor’s degrees awarded in the US, but only 36 percent of the STEM bachelor’s degrees.

And between 2001-2010, African Americans were awarded 9.6 percent of all bachelor’s degrees, and only 7.2 percent of all STEM bachelor’s degrees.

During that same period, Latinos were awarded 8.6 percent of all bachelor’s degrees, and 7.3 percent of all STEM bachelor’s degrees. We simply must do better as a nation if we are going to remain a global energy leader.

Because it will be up to the next generation of Americans to expand and maintain our nation’s energy abundance and global energy leadership; it is up to our generation to make sure that you have skills, knowledge and information needed to make the most of that opportunity.

Our goal is to ensure that anyone who wants a well-paying career has that opportunity. Because that’s the only way we will seize America’s energy moment.

Ultimately we want an oil and natural gas workforce that reflects the diversity of our nation because that is the only way our industry can continue to provide the energy to fuel our nation’s economy and ever-growing worldwide demand for cleaner, cheaper energy.

More broadly, all of us must remain engaged in the national energy conversation.

Because if our nation is to maintain its place as a global energy leader and a major driver of economic growth and job creation, the national energy policy discussion must include the voices of everyone from all regions of our nation and demographic groups.

Remaining a global energy leader could usher in not only an unparalleled era of energy security for our nation and bring stability to the global energy market, but it could also ensure prosperity for future generations.

Ultimately we want an oil and natural gas workforce of the future that is as diverse as our nation so that we can continue to provide the energy to fuel our nation’s economy and ever-growing worldwide demand for cleaner, cheaper energy.

Because what we know to be true is that we will need more energy from all sources in the years to come.

And while short-term cyclical nature of price fluctuation, currently at a six year low, continues to make news and have some questioning America’s energy future, the long-term trend is clear: we will need more energy, specifically oil and natural gas, for many years to come.

In fact, the Energy Information Administration estimates that 25 years from now, oil, natural gas and coal, collectively, will account for 80 percent of the country’s energy consumption.

And contrary to energy industry critics, the women and men who work in the oil and natural gas industry continue to prove that we can lift our nation out of years of energy scarcity AND lead when it comes to safe and responsible environmental stewardship.

For example, since 1990, the oil and natural gas industry has invested $284 billion toward improving the environmental performance of its products, facilities and operations.

Further, from 2000 through 2012, the industry has spent more on low and zero-carbon emitting technologies than the federal government has spent, and that total is nearly as much as all other industries’ spending on these technologies combined

All of which begs a broader and more fundamental question: Do we move forward and build upon our nation’s new era of energy abundance – take full advantage of this American moment – or do we go back to last century’s reality of energy scarcity and dependence?

It is one of the most important national discussions of our time and as such should be fact-based because energy policy is too important to be merely another partisan and ill-informed talking point.

If we are to continue our nation’s current positive energy production trends and environmental gains, we must demand that those who act on our behalf, at all levels of government, implement energy policies based on current market conditions and our potential as an energy leader.

Our goal is to create a new American understanding of energy -- and with it a national energy policy-- based on science, the free market and entrepreneurial spirit because energy is too important and fundamental to our way of life for anything less.

Ultimately we want to create an American consensus on energy policy that will allow our nation to take full advantage of its bright energy future.

What we want and what the American people deserve is energy policy that continues the trend of our nation becoming energy self-sufficient and THE global energy leader. Other nations are ready to take our place if we falter.

The decisions our country makes in this area now will determine our nation’s energy future course for generations to come.

It is my view that we have a responsibility to future generations to get our nation’s energy policy right, seize this American moment to ensure that our nation is second-to-none in energy production, security and economic prosperity.

If we do that future generations will only know the United States as a global energy leader.

Thank you for your time and I’d be happy to take a few questions.