Spike in Colorado gas workers forecast
Employment growth in the development of unconventional natural gas in Colorado will outpace all but one of the other 10 top-producing states over the next few years, a report says.
Colorado is expected to see a compounded 10 percent growth rate in employment through 2015, according to a study by IHS Global Insight.
Only Pennsylvania will outstrip Colorado in terms of employment, the study said.
Employment in the production of unconventional natural gas nationally could jump from 1 million to 1.4 million jobs by 2015 as development of once impossible-to-recover gas reservoirs continues, the study concluded.
The top 10 producing states as ranked by employment in unconventional gas — Texas, Louisiana, Colorado, Pennsylvania, Arkansas, Wyoming, Ohio, Utah, Oklahoma and Michigan — will see a combined compound annual job growth rate of nearly 8 percent, the study said.
Pennsylvania is expected to lead the pack with a 14 percent annual growth rate.
Total employment in the U.S., meanwhile, is expected to grow at an average rate of 1.6 percent during the same period, the study said.
The two largest producers in the Piceance Basin of northwest Colorado have committed to remaining in the basin, despite low gas prices in the range of $2.40 per 1,000 cubic feet. WPX Energy and Encana Corp. both cited high prices available for natural-gas-related liquids such as ethane, propane and natural gasoline.
The report doesn’t take into account oil, such as the development of the Niobrara Formation in eastern Colorado, and is focused entirely on gas and its related liquids, said IHS Vice President John Larson, the lead author of the study.
“At a time when the U.S. economy is slowly recovering from the Great Recession and struggling to create enough jobs to sharply reduce the unemployment rate, the growth in shale and other unconventional natural gas production is a major contributor to employment prospects and the U.S. economy,” Larson said in a statement. “As this report makes clear, these benefits spread beyond producing states to deliver positive impacts across the country.”
The report serves notice that western Colorado stands to benefit even as the gas boom expands, said David Ludlam, executive director of the West Slope Colorado Oil and Gas Association, calling it a reminder to the Obama administration “that federal policies and land planning must not prohibit western Colorado from taking part in the jobs and energy bonanza projected by the study.”
Non-producing states also are expected to benefit from the boom in unconventional natural gas via the supply chain and service jobs, the study said.
Other findings of the study include:
■ Unconventional gas accounted for 53 percent of total U.S. natural gas production in 2010 and is anticipated to rise to 79 percent by 2035.
■ Almost $3.2 trillion in investments in unconventional-gas development are expected to fuel the increase in production between 2010 and 2035.
■ By 2015, the annual contribution of unconventional gas activity to U.S. gross domestic product is projected to reach nearly $197 billion, more than $22 billion of which will be from non-producing states.
In total, the annual contribution is expected to more than double by 2035 to almost $332 billion.
■ Government revenue from unconventional gas activity is projected to reach more than $49 billion annually by 2015 and continue to rise to a little more than $85 billion by 2035. Over the study’s entire 25-year horizon, unconventional gas is expected to generate nearly $1.5 trillion in total government revenue.