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Sean Hackbarth Gas-drilling site on top of the Marcellus Shale in Lycoming County, PA. Photo credit: Nicholas A. Tonelli. Licensed under a Creative Commons Attribution 2.0 Generic license.

Here are four examples of how shale energy development is working on a state level.

1. Natural gas development in the Marcellus Shale is creating thousands of jobs, according to a University of Illinois at Chicago study:

Natural gas exploration in the Marcellus shale formation has created just over 45,000 construction jobs, a new study has concluded.

The study looked at a 13 trades related to natural gas exploration from 2008 through the first half of 2014.

It was commissioned by the Oil and Natural Gas Industry Labor-Management Committee, a coalition of labor and industry interests in oil and gas.

“A preliminary examination of employment data in states related to the Marcellus Shale Play … reveals that natural gas exploration has been a strong engine of job growth,” the researchers with the University of Illinois concluded.

The figures are based on actual hours worked in Pennsylvania, West Virginia, Maryland and Ohio, assuming 1,600 hours in a year for a worker.

Earlier this year, consulting firm FMI estimated that "more than $330 billion will be spent on oil- and gas-related construction during the next four years.”

2. Farther west, Mark Green writes about a new study on the positive economic effects that oil and natural gas development generates in Colorado:

Just looking at 2012, oil and natural gas activity generated more than $200 million for Colorado schools, supported nearly 94,000 jobs in the state and created more than $23 billion [sic] in state economic activity, according to the report conducted by the university’s Leeds School of Business and commissioned by API.

3. An Ohio town in the Utica Shale is experiencing an economic boom from developing natural gas from the Utica Shale:

In Marietta, hotels are full. Restaurants are booming. The city’s median household income shot up more than 20 percent in one year to a 2013 estimate of $40,286, according to the U.S. Census Bureau.

At Marietta’s auto dealerships, the increase in business has been immediate and dramatic.

“Three months ago, we couldn’t get them financed on a $5,000 car,” Marietta dealer Jim Cobb says of one of his recent Chrysler-Jeep-Dodge-Ram customers.

“Suddenly, they come in and buy a $60,000 truck and pay you cash for it.”

4. Let's not forget North Dakota:

Ground zero for America's "shale revolution" in gas and oil production, North Dakota is also the reigning title-holder for lowest unemployment among the 50 states.

There were more unfilled jobs in September than job applications within the state, where oil field workers can make six-figure salaries and even the fast-food restaurants dangle hiring bonuses of $300 or more. The state has been recruiting specifically from Michigan for workers of all stripes and skill levels — hoping to entice entire families to relocate and grow roots.

North Dakota's official 2.8% jobless rate in August is essentially full employment, allowing just about anyone who wants a job to get one

These economic benefits will continue if we embrace America’s energy abundance. A 2012 report from the U.S. Chamber’s Institute for 21st Century Energy stated, “By 2035, unconventional oil and gas will add almost $475 billion dollars to the economies of the lower 48 US states.”

Sean Hackbarth Person pumping gas.Photographer: Andrew Harrer/Bloomberg.

Since the shale boom has made the U.S. the world’s top petroleum producer, we have the opportunity to end the nearly 40-year old crude oil export ban. However, some fear this will mean higher gasoline prices. A new study and comments from a top federal energy expert indicate that won’t be the case.

An Aspen Institute’s study found that “prices of various grades of oil are set in world markets.” Lifting the ban and allowing U.S. oil to be sold globally would put “modest” downward pressure on gasoline prices

The report also found that ending the export ban would encourage more domestic energy development resulting in growth to the manufacturing sector and the economy as a whole:

An average of 37,000 manufacturing jobs would be created every year through 2025 A total of 650,000 jobs would be added at peak in 2019 Household income would rise by $2,000 to $3,000 in 2025

Other recent studies have also concluded that there will be positive effects from lifting the oil export ban. An IHS study estimated $746 billion in new investment and 394,000 new jobs per year through 2030, and a Brookings Institution study projects a $600 billion to $1.8 trillion boost to the economy, while resulting in lower gasoline prices.

As if these studies weren't enough, Adam Sieminsk, administrator of the U.S. Energy Information Administration, gave energy analysts more to chew on by telling Platts Energy Week TV, “Exports might not have that much of an impact on gasoline prices.”

Like the conclusion from the Aspen Institute study, he said, “Preliminary evidence suggests that gasoline prices get set in the global markets." He then explained the mismatch between domestic production and refining capability:

We have a lot of light sweet crude. We have a refining system that's geared to run heavier sour crude.

In May, EIA concluded that 98% of the growth in oil production has comprised of lighter crude, and production of that type of oil “will continue to outpace that of medium and heavier crudes.”

Trade can reduce this mismatch. “[E]xporting some of the stuff that we don't need and getting in some of the stuff that we do need might be something that is best for the economy,” Sieminsk added.

Sean Hackbarth Opponents of the Keystone XL pipeline join the Cowboy and Indian Alliance in a march on the National Mall in Washington, D.C.Opponents of the Keystone XL pipeline march on the National Mall in Washington, D.C. Photographer Pete Marovich/Boomberg.

Opponents of the Keystone XL pipeline want you to believe that stopping the project will ensure that Canada won’t develop its oil resources. Well, someone forgot to tell Canada. From Reuters:

Canadian crude exports to the United States topped 3 million barrels per day last week for the first time, suggesting delays to new export pipelines such as TransCanada Corp's Keystone XL were failing to check oil sands development.

Environmental groups are fiercely opposed to new pipeline projects connecting Alberta's oil sands to the United States and the east and west coasts, reasoning that without market access crude production will slow.

But the latest weekly data from the U.S. Environmental Information Administration shows Canadian crude exports are ramping up rapidly despite the pipeline impasse.

Canada, the No. 1 supplier of crude to the United States, exported 3.248 million bpd of crude to its southern neighbor in the week ended Oct. 3, up 18 percent from the previous week and up 35 percent from the same period a year earlier.

The four-week average to Oct. 3 was 2.977 million bpd.

"It's a pretty clear indication that crude will find its way to market around various constraints," said Sandy Fielden, analyst at RBN Energy.

The State Department came to the same conclusion in its economic analysis of the Keystone XL pipeline:

[A]pproval or denial of any one crude oil transport project, including the proposed Project, is unlikely to significantly impact the rate of extraction in the oil sands or the continued demand for heavy crude oil at refineries in the United States based on expected oil prices, oil-sands supply costs, transport costs, and supply-demand scenarios.

Much of this oil is moving by rail right now, but plans are in the works for additional pipeline capacity. Earlier this year, the Canadian government approved a pipeline to transport oil west from Alberta to British Columbia. It awaits approval from Aboriginal groups. Then there’s the proposed Energy East pipeline:

The proposed $12 billion project would send 1.1 million barrels per day of western Canada’s oil-sands crude 2,900 miles east to Saint John, New Brunswick, on the country’s North Atlantic Coast. The project would convert a 1950s-era underutilized natural gas pipeline and add extensions to each end: one to a terminal south of Alberta’s oil sands in the oil town of Hardisty and the other extending the reach of the pipeline from Montreal to a refinery in Saint John, which has supertanker access that would allow the crude to be transported globally, including to the refineries in Louisiana and Texas that the Keystone XL pipeline would be intended to serve.

It’s obvious that Canada will get oil to hungry global markets anyway it can. It continues making the case for the Keystone XL pipeline because it's a valuable conduit, but at the same time, it’s not waiting for a decision by the President.

The fact of the matter is while Canada continues developing and transporting its oil, America is losing out on the jobs, economic growth, and local tax revenue that would be generated by the Keystone XL pipeline.

Pipeline opponents are so rigidly fixed to their anti-energy ideology that they reject the economics and science surrounding the pipeline. Facts don’t matter to them. President Obama should ignore their hysteria and approve the Keystone XL pipeline.

Sean Hackbarth Power lines covered in snow and ice.

“This country did not just dodge a bullet ― we dodged a cannon ball.”

That’s how Nicholas Akins, CEO of American Electric Power (AEP), described the situation last winter when the polar vortex hit the United States and put tremendous strain on the power grid.

John Kemp at Reuters writes how the power grid barely held up to the cold temperatures and notes how a reduction in fuel diversity played a role:

Since the late 1990s, most new power generating units have been built to burn natural gas. Unlike coal or oil, gas is not usually stored on site, so generators rely on real-time deliveries from the gas pipeline network.

In many cases, generators relied on purchasing extra gas in the spot market to meet peaking electricity demand. But with gas consumption also hitting record levels, generators were unable to contract for sufficient volumes and arrange for delivery through an already congested pipeline network.

The increase in gas-fired generation has introduced an unanticipated and dangerous link between the gas and electricity systems - with the risk of common failure.

According to NERC [North American Electric Reliability Corporation], gas supply problems led to losses of 620 MW of generation in the Midwest, 3,300 MW in the Northeast, 11,000 MW in the Middle Atlantic states, 2,000 MW in the Southeast and around 2,000 MW in Texas.

Thankfully coal-fired power plants were still available to support the grid, as I wrote in April [emphasis mine]:

AEP generates electricity in the region, and company CEO, Nicholas Akins told shareholders on a conference call last week that 89% of his company’s coal-fired plants scheduled to be shut down in 2015 were running during the cold snap.

But what about the next severe cold snap? Federal policies like EPA’s proposed carbon rules could mean those coal-fired plants won’t be there to keep the lights on and heat homes.

This is why electric resource diversity is critical. Since natural gas is used for both electricity and heating, and regions like the Northeast have natural gas “infrastructure constraints,” killing coal use will put more stress on natural gas infrastructure and make the power grid more vulnerable.

The lesson to be learned from the polar vortex, FirstEnergy CEO Tony Alexander told an audience at the U.S. Chamber in April, is “We need to maintain a diverse fleet – including real generating assets such as coal, nuclear and natural gas – to ensure reliable, affordable service over the long term.”

No matter how the winter will be this year, we need federal policies in place that maintain fuel diversity and the security of our electric grid.

Sean Hackbarth Combine harvesting grain and loading it into a truck.Photo credit: Charles Knowles. Licensed under a Creative Commons Attribution 2.0 Generic license.

Having an outstanding grain harvest is a great… unless you can’t get it to market. The Keystone XL pipeline can help.

These headlines illustrate the situation Great Plains farmers face:

Williston Herald: “Local farms feeling the pressure of delayed shipments” The Hill: “ND oil trains cause large backlogs for grain shipments” Reuters: “Trains for grains scarce on the U.S. Plains” New York Times: “Grain Piles Up, Waiting for a Ride, as Trains Move North Dakota Oil” Seattle Times: “Oil trains crowd out grain shipments to NW ports

With its delays, the Obama administration has created a situation where farmers watch in frustration as oil cars loaded with Bakken and Canadian crude pass by as their grain sits in silos.

On the recent Keystone XL Lost Opportunities Tour, Mona Madler, executive director of the Southeast Montana Area Revitalization Team (SMART) in Baker, MT--where a pipeline that will carry Bakken oil will connect to the Keystone XL-- told me that farmers are “dumping grain on the ground,” because they can’t get it to market. Tom Kauer a community leader in Winner, SD said, “Millions of bushels are sitting on the ground.”

Senators Thune and Klobuchar have asked Secretary Vilsack to look into the backlogs agricultural producers have faced, but part of the answer has been staring at us in the face for six years: Approve the Keystone XL pipeline.

Heritage Foundation economist Nicolas Loris explains:

The Keystone XL pipeline, in particular, would help carry significant amounts of crude oil. According to the North Dakota Pipeline Authority, “Bakken rail outflow capacity totaled 965,000 barrels per day (bbl/d) at the end of 2013, compared to 515,000 bbl/d of pipeline capacity.” Keystone XL would help to minimize this problem.

TransCanada has said that Keystone XL could accept up to 100,000 barrels of Bakken oil for transport.

Will building the Keystone XL pipeline solve all these transportation problems? No, but it can be part of a solution. Until the pipeline is approved, millions of bushels of grain continue sitting in silos. Talk about a lost opportunity.