After a 30-year decline in domestic oil production, recent technological advances in exploration such as horizontal drilling and hydraulic fracturing (“fracking”) have dramatically altered the nation’s energy picture. From 2007 to 2012, production of domestic shale gas increased by more than 50% a year and recovery of so-called “light tight” oil is growing even faster.At this rate, the U.S. will be the largest producer of petroleum in the world by 2030, exceeding even Saudi Arabia.
A recent report by the McKinsey Global Institute calls the dramatic turnaround a “game-changer” for the U.S. economy – a boom that will dramatically increase employment in the energy industry, stimulate American manufacturing, add 2 to 4 per cent to GDP while creating 1.7 million new jobs by 2020.
According to the report, the impact will be especially positive for industries that rely on natural gas as a fuel or feedstock, including petrochemicals, fertilizer, and synthetic resins; iron and steel; and glass, paper and pulp, and plastics packaging. In addition, McKinsey estimates that the infrastructure required to support this increased production promises to create another 1.6 million jobs during the build-out, most of it in the construction sector.