Western Energy Alliance
1775 Sherman St, Suite 2700 , Denver, Colorado, United States

Western Oil & Natural Gas?

Oil and natural gas delivers all the obvious benefits everyone knows–mobility to get to work, school, and vacation; home heating and cooling; electricity; and the power for every aspect of the economy. But oil and natural gas also provide the feedstock for medicines, fertilizers, plastics, synthetic fabrics, electronic components and many other common household items. Water treatment and delivery systems, and public sanitation and safety require oil and natural gas. Simply put, pretty much everything you put into or on your body just wouldn’t be possible without oil and natural gas. No other existing energy source does everything that oil and natural gas does reliably, 24/7 at an affordable price.  Those who want to Keep It in the Ground and stop all oil and natural gas production simply aren’t facing reality. If they got their way here in America, we’d just have to import that energy from overseas, sending over $350 billion abroad. Even more pernicious is their desire to deny the nearly one billion people worldwide who lack access to electricity the healthy, happy and safe lifestyles we enjoy here in the developed world.  That’s why Western Energy Alliance is proud to be part of the American energy success story, representing the exploration & production (E&P) or “upstream” sector of the industry that discovers, develops, and produces oil and natural gas in 13 western states. For more than a decade, the United States has undergone a “Shale Revolution” as a result of innovation, and western producers have played their part. We’ve helped make the United States the dominant force in the global energy market. In addition, western states are delivering tremendous benefits that improve the climate, support allied nations, and benefit our local communities. 

Climate and Environmental Benefits 

The United States leads the world in greenhouse gas (GHG) emission reductions, and the primary reason is natural gas. The incredible progress has been made without heavy-handed federal policies like a carbon tax, cap-and-trade, or the Paris climate accord. Rather, the oil and natural gas industry has helped reduce greenhouse gas emissions 14% below 2005 levels through a market-driven increase in natural gas electricity generation.  While the carbon reduction is impressive, the United States also benefits from utilizing the most technologically advanced and environmentally sound production techniques. Local regulators and companies work together to reduce emissions of greenhouse gases and air emissions from the oil and natural gas sector even as production of natural gas has increased by 55% and oil by 46% over the last decade.

Energy Security

  Through advanced drilling and completion technologies, the United States became the world leader in oil production in 2018. As the leading producer of oil and natural gas, the United States not only reduced its reliance on foreign sources of energy but has reduced our allies’ dependence on unfriendly sources as well. The United States is already a net natural gas exporter, and petroleum exports continue to set records.  It’s a similar story with the recent expansion of liquefied natural gas (LNG) exports. Europe could be freed from dependence on unreliable supplies of Russian natural gas with increased imports of American LNG. Likewise, LNG exports from western states could benefit allies in Asia seeking reliable electricity sources.

Natural Gas

This is an exciting time in our nation’s history as the U.S. is leading a global renaissance in natural gas development. Companies are employing new technologies and millions of American workers to make an enormous domestic supply of clean energy available for generations to come. Technological breakthroughs have made rich reserves of natural gas widely available, introducing price stability to once volatile natural gas markets and uncovering more than a 100-year supply. Annual natural gas production has risen by over 6.7 trillion cubic feet (Tcf) or 26% since 2005 while the price has decreased by 69% since 2008.  With the domestic increase in natural gas production and growing reserves, U.S. energy policy should no longer be based on the notion of scarcity, as it has been for several decades. For example, the Natural Gas Act of 1938 prevents approval of exports to countries without a free trade agreement (FTA). Exporting to countries without a FTA, currently about 96% of global LNG demand, requires approval by the Energy Secretary, a lengthy process which is stifling free trade in natural gas.  Natural gas has three characteristics that make it ideal for our energy future–it is abundant, affordable, and clean.

Abundant

The Colorado School of Mines Potential Gas Committee estimates U.S. natural gas potential resources at 2,384 Tcf, an increase of 27% since 2005. At current consumption rates, potential resources represent a 110 year supply that positions natural gas as a crucial component of our nation’s energy portfolio for the foreseeable future.  As recently as 2005, the United States was preparing to import natural gas as proved reserves ran low, but now companies are attempting to license and build export facilities. 

Affordable

America’s huge supply of natural gas has kept prices low, benefiting residential and commercial consumers. Natural gas prices have decreased by 69% since 2008, saving American families on their heating and electricity bills. According to IHS, households pocketed $1,200 in savings from low natural gas prices in 2012, and that number will rise to $2,000 by 2015.

Natural Gas Is Bringing Manufacturing Back to the U.S.

The low price of natural gas is reviving American manufacturing and creating hundreds of thousands of jobs as companies build or expand plants. Natural gas is a major input to fertilizer manufacturing, and natural gas liquids are an important feedstock for chemical manufacturing. The American Chemistry Council reports that manufacturers are planning 148 new chemical manufacturing projects to take advantage of abundant, affordable natural gas and liquids supplies. ACC anticipates over $100 billion in new capital investment will create 637,000 permanent new jobs in the chemical industry and add $81 billion in annual economic output by 2023.  European companies are moving their manufacturing to the United States to take advantage of our abundant natural gas supply. BASF is converting a crude-based naphtha cracker in Port Arthur, TX, to run on natural gas-based ethane. Linde, a German industrial gas company, plans to invest $200 million in Texas to create the world’s largest natural gas-based syngas chemical plant.