U.S. oil and natural gas production is off the charts and forecasts show it won’t be slowing down any time soon. But is this a bad thing? A new report from the anti-industry Oil Change International tries to argue that it is, but fails to make its case.
Leave it to a “Keep It In the Ground” group to try to spin this record-shattering production into a “climate disaster” when it’s actually bolstering the U.S. gross domestic product, helping to reduce carbon emissions and increasing energy security.
This messaging is hardly surprising, as Oil Change’s Strategic Communications Director David Turnbull’s frequent #KeepItInTheGround tweets and recent calls for the government to “seize the fossil fuel industry” leave no doubt about the group’s agenda.
Yes, stop that sentence at “seize the fossil fuel industry” and I’m in.
— David Turnbull (@david_turnbull) January 8, 2019
U.S. GDP Growth
The Oil Change International report claims that stopping fossil fuel expansion is “the only way towards an economically secure, livable future,” and is manageable because “all mining, including oil and gas extraction, accounted for only 1.4 percent of U.S. gross domestic product (GDP) in 2017.”
But the most recent Bureau of Economic Analysis data from November 2018 show that it is the mining sector – predominantly oil and natural gas – that is driving U.S. GDP growth. As BEA explains:
“Real GDP growth accelerated to 4.2 percent in the second quarter, up from 2.2 percent in the first quarter. Mining was the leading contributor to the acceleration in real GDP growth in the second quarter.” (emphasis added)
“Real gross output for mining increased 33.2 percent in the second quarter, after increasing 13.2 percent in the first quarter. This was the largest increase since the first quarter of 2017 and was primarily attributed to oil and gas extraction.” (emphasis added)
U.S. GDP increased nearly 49 percent from 2005 to 2018 at the same time that oil and natural gas production grew by 177 percent and 68 percent, respectively. In good news for Americans, but bad news for Oil Change International’s faulty argument, during the same period, CO2 emissions fell 11 percent.
The Appalachian Basin (Ohio, Pennsylvania and West Virginia) – one of the “epicenters of fracking” where “nearly 60% of the carbon emissions enabled by new U.S. drilling would come,” according to the report – is actually spearheading U.S. CO2 reductions.
The combined basin accounted for 18 percent of total U.S. carbon emissions reductions and 21.5 percent of total U.S. carbon emissions reductions for electricity generation, according to the most recent Energy Information Administration data. Ohio actually has the highest reductions in the nation – a whopping 57 million metric tons (MMT) total and 50 MMT emissions from electricity generation.
Further, multiple studies have shown that the leakage rates of methane are well below the threshold for natural gas to maintain its climate benefits.
While it may not be what “Keep It In the Ground” groups such as Oil Change International want to hear, the fact remains that the United States is proving the economy and the environment can improve simultaneously. And the oil and natural gas industry is a major driver of those improvements.