In the U.S.
As recently as 2007, the U.S. was unaware of the scale of the unconventional gas resource potential at its disposal. Today it holds reserves that could sustain its population for 100 years. Although Europe's gas resources may not be at a similar magnitude as the U.S., the economic benefits are indicative of the impact a growing gas industry in Europe could have.
From 2006 to 2010 U.S. shale gas production grew by an average of 48 per cent per year. Further increases in shale gas production are expected, with total production growing by almost threefold from 2009 to 2035.
An IHS study shows that shale gas and oil development currently supports more than 1.7 million U.S. jobs, which is projected to rise to nearly 3 million by the end of the decade. Between 2010 and 2035 shale gas development is expected to bring in $1.9 trillion in capital investment into the U.S. economy, generating nearly $1 trillion in local, state and federal tax revenues.
U.S. residents and small businesses have benefitted from an increase in disposable income of an average of $1,200 per household in 2012, while the U.S. manufacturing industry is experiencing a renaissance with building of new plants for steel, growing chemical industry, etc.
As Europe intensifies its exploration and extraction activities of domestic unconventional gas reserves, the aim is to emulate the success of the U.S. and allow Europeans to benefit from the economic stimulus driven by this domestic natural gas production.
Produced domestically, it is estimated that approximately 80 per cent of the value created from natural gas extraction would remain in the country in order to support local communities and state budgets. Over the past 10 years, the German economy has benefitted from an influx of approx. 7 billion Euros through natural gas production tax alone.
Pöyry – EU Domestic Shale Gas Production could add 1 million jobs
A study conducted in 2013 by independent consultancies Pöyry Management Consulting and Cambridge Econometrics quantifies for the first time the potential economic impact of shale gas production in Europe.
The research, commissioned by the International Association of Oil and Gas Producers (IOGP) highlights that domestic shale gas production in the EU member states could boost employment, GDP and European competitiveness, while reducing import dependency.
The scenario-based study modelled the economic impacts of three different shale gas production levels on the European economy up to 2050. Results showed that by 2035 shale gas production in Europe could add between 400,000 and 800,000 jobs, potentially reaching 600,000 to 1.1 million by 2050. Europe´s security of supply could be increased as domestic shale gas production could reduce its import dependency from 89% to between 78% and 62% in 2035. GDP on the other hand could increase cumulatively by between €1.7tn and €3.8tn between 2020- 2050. Finally, reductions in wholesale gas and energy prices stemming from EU shale gas production could also increase available income to households and improve European industrial competitiveness. See the full report and IOGP’s press release for more.