TIPRO Report Reveals Texas Oil & Gas Industry Leads Nation in Employment and Production

Study provides in-depth analysis of national and state trends in oil and gas employment, wages and other key economic factors.

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Texas Independent Producers & Royalty Owners Association

“Texas continues to lead the country in oil and gas production, innovation and employment, due in part to our favorable business and regulatory climate,” said Ed Longanecker, president of TIPRO.

Austin, TX (PRWEB) April 02, 2013

The Texas Independent Producers & Royalty Owners Association (TIPRO) today released its inaugural “State of Energy Report,” offering a detailed analysis of national and state trends in employment, wages and other key economic factors. The release of the report coincides with the current 83rd Texas Legislative Session to reinforce the positive impact, and critical importance, of the oil and gas sector for the local, state and national economy.

According to the TIPRO report, at the national level, the U.S. oil and gas industry employed 971,200 in the first half of 2012, up 7 percent from 2011. The oil and gas industry paid a national annualized wage of $107,200 in 2012, 119 percent more than the average private sector wage of $48,900, and higher than average wages for construction, manufacturing, wholesale trade, information, professional services, health care, financial services, and education services. Payroll in the U.S. oil and gas industry was $104 billion in 2012, up by 12 percent, which accounts for a considerable amount of the federal and state income taxes paid.

Ongoing innovation and advancements in horizontal drilling and hydraulic fracturing have made it possible to produce increased levels of oil and natural gas from shale plays that were once unreachable with conventional technologies. This in turn is allowing for a remarkable increase in the production of oil and gas from unconventional shale plays. During 2012, total U.S. crude-oil production reached its highest level in nearly 15 years, with daily production averaging nearly 6.5 million barrels, according to the U.S. Energy Information Administration (EIA).

In Texas, the oil and gas industry employed 379,800 and added the highest number of new jobs in the oil and gas industry in the first half of 2012, rising by 34,600, with growth expected to exceed 50,000 net new jobs for the complete year of 2012. Texas was followed by the other high growth states in terms of industry employment, including: Oklahoma (+7,300 jobs), North Dakota (+6,400 jobs), and Pennsylvania (+4,200 jobs). When examining employment in the various industry sectors that make up the oil and gas industry, Texas was the top state with employment in every single sector. In fact, oil and gas employment is so concentrated in Texas that of the ten industry sectors used in this report to define oil and gas, six sectors had 40 percent or more of the jobs located in Texas.

“Texas continues to lead the country in oil and gas production, innovation and employment, due in part to our favorable business and regulatory climate,” said Ed Longanecker, president of TIPRO. “This year alone, our industry will invest literally tens of billions of dollars in oil and gas exploration and production in Texas. We must continue to support this tremendous momentum through sound policies, while responsibly addressing all issues associated with this growth.”

In 2012, taxes and state royalties paid by the oil and gas industry in Texas exceeded $10 billion. This important source of revenue helps to provide crucial funding to all areas of the state and local economy, including schools, Medicaid, children’s health insurance programs, children's protective services, roads, and police and fire departments.

“Increasing domestic production of oil and gas is providing hope for a bright future for our country, contributing billions to our government coffers and supporting millions of American jobs, while at the same time lessoning our dependence on foreign oil and reducing carbon dioxide emissions through increased use of natural gas,” added David F. Martineau, chairman of TIPRO.

Despite the unprecedented economic contributions by the oil and gas industry, and the many advantages associated with increasing domestic development of oil and natural gas, a number of state and federal issues threaten to slow this progress. Federal agencies like the U.S. Environmental Protection Agency (EPA), the U.S. Fish and Wildlife Service (USFWS), and the U.S. Department of Interior (DOI), continue with attempts to implement onerous regulations and restrictions on industry activity that have no basis in science, threatening the livelihood of oil and gas producers, particularly independents who collectively drill up to 95 percent of the oil and natural gas wells in America. Federal tax provisions for oil and gas exploration and production also remain a target for industry opponents.

Many pressing issues also exist at the state level in Texas that could jeopardize future industry growth, from a lack of infrastructure to environmental concerns and attempts to eliminate business incentives that have helped to make Texas a model for all oil and gas producing states seeking economic growth and prosperity.

“This is a critical time for our state and our country, as the economy continues to recover from the last recession,” noted Martineau. “If these issues are not handled properly by government officials, there is a very real risk of stifling the positive momentum experienced as a result of increasing domestic development of oil and gas.”

Key legislative priorities in Texas for TIPRO include maintaining the high-cost gas severance tax reduction for natural gas exploration and production activities in the state. Established in 1989, the high-cost gas tax reduction continues to provide an excellent return on investment for Texans, from spurring economic growth in regions across the state to boosting contributions made to Economic Stabilization Fund and aiding in funding education, hospitals, and first responders. Additional priorities for TIPRO entail monitoring the Sunset Review of the Texas Railroad Commission (RRC), legislation to address road repair and maintenance in areas with an influx of industry activity, infrastructure needs across the state to meet increasing population demands and funding for the state water plan.

“TIPRO commends our elected officials in Texas for their leadership in addressing these important issues that are currently facing our industry and state,” said Longanecker. “TIPRO remains committed to working with government and industry leaders to provide accurate and truthful information about oil and gas development, the extensive precautions taken to protect the health and safety of our community and the unmatched economic contributions of our sector.”

What does Oil & Gas mean for Texas?

  •     379,800 oil and natural gas workers in 2012 (ranked 1st in U.S.). More than 34,600 net new jobs were added in 2012. Approximately 4.3 percent of all jobs in Texas are in oil and gas.
  •     39 percent of all oil and gas jobs nationwide were located in Texas in 2012.
  •     Oil and natural gas workers earned an average wage of $128,100, equivalent to 150 percent more than average private sector wage in Texas.
  •     Total oil and gas payroll was $48.7 billion for Texas in 2012 (ranked 1st in U.S.), totaling 10.7 percent of payroll in Texas is in oil and gas sector.
  •     11,700 oil and natural gas establishments were located in Texas in 2012 (ranked 1st in U.S.). Overall, 28 percent of all U.S. oil and gas establishments are based in Texas.
  •     Total Texas oil production for 2012 was equal to 717 million barrels (ranked 1st in U.S.). Oil production in Texas in 2012 rose by 185 million barrels compared to 2011, a 25 percent increase.
  •     Total Texas gas production for 2012 exceeded 8 trillion cubic feet (ranked 1st in U.S.). In 2012, gas production in Texas rose by 102 billion cubic feet compared to 2011, a 1 percent increase.
  •     Total Texas well count for 2012 was 257,609 (ranked 1st in the U.S.). This represented an increase of 1 percent compared to 2011, or 1,756 wells.

The Annual “State of Energy Report” is published by the Texas Independent Producers & Royalty Owners Association (TIPRO). Data is collected from the U.S. Bureau of Labor Statistics, the Energy Information Administration, the Texas Railroad Commission and DrillingInfo. Data pertains to 2012 except where noted and is derived from the first two quarters, the most current information available for comparable state data at time of publication.

Click here to download a copy of TIPRO’s Annual “State of Energy Report”.

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About TIPRO
The Texas Independent Producers & Royalty Owners Association (TIPRO) is a trade association representing the interests of over 2,500 independent oil and natural gas producers and royalty owners throughout Texas. As one of the nation’s largest statewide associations representing both independent producers and royalty owners, members include small businesses, the largest, publicly-traded independent producers, and mineral owners, estates, and trusts. Members of TIPRO are responsible for producing more than 85 percent of the natural gas and 70 percent of the oil within Texas, and own mineral interests in millions of acres across the state.