Fracking is Revolutionizing the Oil and Gas Industry
NCPA Study: The Federal Government Stands in the Way of Greater Supply, Lower Prices, and Increased Employment
October 24, 2013
Fracking is currently responsible for more than 30 percent of U.S. domestic oil and natural gas reserves, and the National Petroleum Council estimates that 60 to 80 percent of all U.S. drilling over the next decade will require fracking.
In just two short years, oil production from fracking has nearly reversed a 20-year-long oil production decline:
- In 1990, the United States produced approximately 7.5 million barrels per day of crude oil.
- By 2009, that had dropped to as few as 4 million barrels per day at times.
- Since then, production has returned to about 7.5 million barrels a day.
- Since summer 2011, U.S. crude production has increased 2 million barrels per day.
"Fracking has been a blessing in the oil fields. The oil it has delivered has reduced our trade deficit and our dependence on questionable foreign regimes for oil," said Sterling Burnett, senior fellow at the National Center for Policy Analysis. "We've reduced the billions of dollars we ship overseas each year through the dramatic increase in domestic supplies of oil made possible by fracking."
Fracking's role on the natural gas front is just as impressive. Natural gas could not be the energy provider that it is without the vast reserves that fracking opens up every day:
- Natural gas has become the fuel of choice for generating base load electricity -- the minimum amount of power needed 24 hours a day.
- Gas is still the preferred fuel for peaking power dispatched to the electric grid during times of peak demand.
"The energy produced from fracking has been a boon for this country - among the only industries creating jobs during the recent recession," said Burnett. "Absent the massive amount of natural gas unleashed through fracking, our electric bills would be much higher than they are today, and no one would be pushing electric or hybrid electric cars."
The United States could increase oil and gas production even more by removing regulatory barriers. Current restrictions on offshore oil production and on public lands across the west and in Alaska prohibit the exploration and production of billions of barrels of oil and trillions of cubic feet of natural gas. Lifting these restrictions would increase supply, reduce prices and imports, and provide high-paying jobs to Americans.
"Fracking has not been linked to persistent, widespread, or inherent problems, thus the federal government should accept the mountain of evidence that fracking is safe and should streamline the permitting and leasing process on public lands in order to reap the economic and energy bounty of fracking," Burnett concluded. "If problems arise, regulations can be tailored as narrowly as possible to address issues relevant to specific geographic sites."
Source: H. Sterling Burnett, "How Fracking Helps Meet America's Energy Needs," National Center for Policy Analysis, October 2013.
Full study: http://www.ncpa.org/pub/ib132