New study shows the benefits of natural gas across the U.S.

By Staff | June 27, 2017

Natural gas production from Pennsylvania’s Marcellus shale play provides a good example of how the resource benefits all 50 states as outlined in a new report from the American Petroleum Institute (API).

Stephanie Catarino Wissman, executive director of API Pennsylvania, noted that Shell’s petrochemical plant in Potter Township about 30 miles northwest of Pittsburgh is a $6 billion investment in the state. It will support 6,000 jobs during construction and many other jobs after it begins operating.

“Over the past decade, our state has experienced massive growth in natural gas production due to innovation throughout the energy industry that has allowed us to harness and produce more natural gas,” she said. “We are now the nation’s second largest producer of natural gas.”

She also noted that the state’s natural gas production also benefits non-energy producing states such as New York and Massachusetts that depend on Pennsylvania to heat and power homes and business. 

According to Erica Bowman, API’s chief economist, a unique aspect of the report is that it defines the entire natural gas value chain, including its uses as a feedstock and in providing energy.

The new study—conducted for API by ICF International—details the benefits natural gas brings to the nation in terms of consumer savings, family-sustaining jobs and economic growth. The study shows that all 50 states benefit from natural gas produced domestically.

For example, in 2015, natural gas supported more than 4 million jobs across the country ranging from production to end uses such as manufacturing. The study expects this number to rise to 6 million jobs by 2040. Also 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 addition, the study estimates that by 2040, consumers across the country will save an estimated $100 billion—or $655 per household—from the increased use of natural gas throughout the U.S. economy, from manufacturing to electrical generation.

Bowman said that the U.S. needs infrastructure to support continued development of its natural gas resources.

“By building the infrastructure in the United States, you’re actually taking advantage of natural gas liquids and natural gas itself, which is much more cost competitive when you put it on the world stage,” she explained.

However, Bowman said the free trade policies pursued by the Trump administration are a cause for concern and an issue that needs to be resolved.

“In order for these types of investments to happen in the United States, it’s really about whether there’s there going to be a big demand globally for these products,” she said. “And is the U.S. going to be able to actively participate in these markets in a free and uncumbersome way? That’s something we really need to work on with the administration because there’s a lot of opportunity and free trade is really driving that.”

The full study containing information on the benefits of natural gas in each of the 50 states is available on API’s website