The U.S. is set to become the world’s largest oil and natural gas producer due to the advent of hydraulic fracturing and horizontal drilling. The American energy boom is also drastically reducing oil and gas imports at a time when much of the world is becoming more reliant on energy imports.
According to the U.S. Energy Information Administration (EIA), increased production from U.S. shale formations will reduce liquid fuel imports and make the country a net natural gas exporter by 2018. By 2016, only 25 percent of America’s oil consumption will be imported, down from 40 percent in 2012 and 60 percent in 2005.
At the same time, other countries will see their reliance on imported oil and gas rise. EIA reports that China, India and European members of the Organisation for Economic Co-operation and Development will each import at least 65 percent of their oil and 35 percent for their natural gas by 2020.
“America is breaking away from the pack thanks to innovations in hydraulic fracturing and horizontal drilling,” said Zachary Cikanek, spokesman for the American Petroleum Institute. “The EIA report shows that other major economies are relying more on imported energy, while the U.S. is quickly gaining ground as a major energy producer.”
Rapid industrialization and economic growth in China and India mean oil and gas demand will likely outpace those countries’ production capabilities. In Europe, on the other hand, declining North Sea oil production will make them more dependent on fuel from abroad.
Hydraulic fracturing, or fracking, and horizontal drilling on federal and state lands has caused U.S. oil and gas production to boom in recent years as drilling companies can now unlock previously unreachable resources. In particular, rising natural-gas production has sparked renewed interest in exporting it to other countries. Experts and politicians were talking about importing the fuel just a few years ago.
“This is an enormous economic opportunity that will mean higher U.S. exports, millions of jobs, and a much stronger competitive position in the global economy,” Cikanek added.
Even the Obama administration has ostensibly embraced booming natural-gas production as part of his effort to reduce U.S. carbon dioxide emissions — natural gas emits less than coal when burned for power.
“For the first time in 18 years, America is poised to produce more of our own oil than we buy from other nations,” President Barack Obama said in a speech at Georgetown University last year. “And today, we produce more natural gas than anybody else. So we’re producing energy. And these advances have grown our economy, they’ve created new jobs, they can’t be shipped overseas — and, by the way, they’ve also helped drive our carbon pollution to its lowest levels in nearly 20 years. Since 2006, no country on Earth has reduced its total carbon pollution by as much as the United States of America.”
But the Obama administration has been reluctant to let the U.S. energy boom spread to federal lands. Oil and gas production on federal lands fell in both 2011 and 2012, according to the Congressional Research Service (CRS), while energy production on non-federal lands boomed.
“All of the increased production from FY2007 to FY2012 took place on non-federal lands, causing the federal share of total U.S. crude oil production to fall by about seven percentage points,” according to the CRS. “Overall, U.S. natural gas production rose by four trillion cubic feet (tcf) or 20 percent since 2007, while production on federal lands (onshore and offshore) fell by about 33 percent and production on non-federal lands grew by 40 percent.”
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