A. Lee Graham lgraham@bizpress.net
A North Texas economist believes the nation is missing the boat when it comes to maximizing its energy potential. “We may be missing a tremendous opportunity because global demand for natural gas is growing exponentially,” said Bernard Weinstein, an economist and associate director of the Maguire Energy Institute at Southern Methodist University in Dallas.
Speaking at a July 17 meeting of the Dallas Society of Petroleum Engineers, Weinstein confirmed the United States’ energy dominance. At almost 400 million barrels of oil per day, the United States ranks third among the world’s largest oil producers, according to BP. Only Saudi Arabia and Russia produce more. The Energy Information Agency predicts that the nation will surpass all other countries in non-OPEC oil production growth by 2014. An agency report predicts that the United States’ production will grow by 2.75 million barrels per day, with Canada trailing a distant second place at .78 million barrels per day.
In terms of natural gas production, the United States is equally productive. In 2011, it produced slightly more than 60 billion cubic feet per day of natural gas, according to a June 2012 BP Statistical Review of World Energy report. While the United States leads the world in natural gas, coal and nuclear power generation, the country still trails Saudi Arabia and Russia in total production.
“We could become No. 1 in oil if we had public policy regulations that are conducive to fossil fuel development,” said Weinstein, who blamed environmentalist pushback for blocking that possibility. Attempts to kill the Keystone XL pipeline and impede hydraulic fracturing are preventing the United States from reaching its potential, Weinstein said. Exporting some of the country’s energy riches could help enrich the economy on a national scale, Weinstein said. “The irony is we’re the world’s No. 1 natural gas producer, and we don’t export any of it,” Weinstein said. He called subsidizing electric vehicles “wasting taxpayer dollars” when he said the nation would be better off building infrastructure to support natural gas-powered vehicles. Natural gas continues paying dividends in Texas. In South Texas’ Eagle Ford Shale, fracking is expected to create 117,000 full-time jobs by 2021, according to a study by the Center for Community and Business Research at the University of Texas-San Antonio. The Eagle Ford Shale spans 22 counties in a diagonal line stretching from Webb, Maverick and Zapata counties in southwest Texas near Mexico to Leon County just north of Houston.
The Eagle Ford’s ascension has not occurred overnight. A steady shift in drilling activity from North Texas’ Barnett Shale to the Eagle Ford was examined as early as 2011 as part of an oil and gas seminar in Fort Worth. In a presentation by Jamie Lavergne Bryan, an attorney with the Winstead PC law firm, drilling permits secured for Barnett Shale operations were shown reaching 4,145 in 2008, compared with just 26 for the Eagle Ford Shale, according to information from the Texas Railroad Commission.
The Eagle Ford number rose to 94 in 2009 and 1,010 in 2010, while Barnett Shale permits rose to 1,755 and 2,157 in the same time periods, respectively. And from January through September 2011, the number of drilling permits issued for Eagle Ford Shale operations surpassed those issued for Barnett Shale drilling, at 2,117 compared with 1,414. “The Eagle Ford’s going to be around for a long time,” said Weinstein, while he acknowledged diminished production in the Barnett due to low natural gas prices. Still, he did not count out the play closest to Fort Worth. “It could come back,” Weinstein said.