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CBO: shale development bolstering US economy

Dec 12, 2014

Development is increased GDP and helped consumer pocketbooks

As the Marcellus Shale Coalition (MSC) and others have documented, the United States Congressional Budget Office (CBO) issued a new report “The Economic and Budgetary Effects of Producing Oil and Natural Gas From Shale,” that demonstrates the benefits that shale development are having across the United States.

The CBO is a “strictly nonpartisan” agency that “conducts objective, impartial analysis” and reports that shale gas will continue to enhance the nation’s gross domestic product (GDP), increase federal tax revenues, stabilize energy prices, continue to generate royalties for landowners, and support family-sustaining jobs.

According to the MSC’s posting on the CBO’s 48-page report:

  • CBO estimates that if shale gas did not exist, the price of natural gas would be about 70 percent higher than currently projected by 2040.
  • The technological innovations behind hydraulic fracturing and horizontal drilling make existing labor and capital…more productive than they otherwise would be. That heightened productivity has increased GDP and will continue to do so.
  • Shale development causes labor and capital to be used that would otherwise be idle, again raising GDP.
  • The increase in GDP resulting from shale development has increased federal tax revenues, and it will continue to do so.
  • CBO estimates that federal tax revenues will be about three-quarters of 1 percent (or about $35 billion) higher in 2020 and about 1 percent higher in 2040 than they would have been without shale development.
  • This report considers options that would change export policies … and concludes that the options would probably increase domestic production but have little effect on prices. … That increase in production would probably make GDP and federal revenues slightly higher than they would be under current export policies.

CBO

Another recent analysis of federal data found that Washington County, which is home to Range’s core operating area, has experienced job growth of “historical merit” while outperforming national employment averages. At the same time, Washington County residents will not see property tax increases as a result of revenues generated from responsible natural gas development.

Range provides more complete details on the Company’s commitment to local job creation and the Company’s support for local service providers in Range’s online Corporate Responsibility Report.