Yesterday, the Obama administration released a report on the Department of Interior's contributions to the economy in 2011. According to the press release, the activities of Interior added $385 billion to the U.S. economy and supported more than 2 million jobs in 2011.
Those are indeed impressive numbers. But it's a bold move to claim that the activities of Interior contributed these jobs and dollars. After all, what is the source of these jobs?
Energy. The report does acknowledge that "energy development and mining on Interior-managed lands and offshore areas supported about 1.5 million jobs and $275 billion in economic activity." However—it's not even just energy development as a whole. An overwhelming amount of those economic benefits stems from the work of America's oil and natural gas companies.
Where is this federal lands job creation happening? Interior points to Texas, Wyoming, Louisiana, New Mexico, California, and Florida. No kidding! After all, almost all of these are HUGE oil and natural gas producing states. According to IPAA's Oil & Gas Producing Industry in Your State (OPI), Texas, Wyoming, Louisiana, New Mexico, and California (all except Florida) rank in the top 10 producing states for either oil production, natural gas production—or both. So it's no wonder that these states have sourced "most of these jobs."
Western Energy Alliance, which represents Western independent oil and natural gas companies, crunched the numbers. They found that 62% of the total economic value and 56% of the total jobs that the Department of the Interior claims in its report actually comes from America's oil and natural gas industry. That's $238.5 billion in GDP and 1.3 million American jobs!
It would be one thing if the Obama administration was touting these jobs while truly creating a national energy policy that encouraged American energy production. But between Interior's five year offshore plan which restricted offshore access and Interior's draft rules for a blanket, one-size-fits-all standard for hydraulic fracturing and well construction on federal lands, it seems that this administration falls far short of promoting oil and natural gas development. Instead, Interior is creating an uncertain, burdensome business climate for the very industry whose jobs the department is claiming credit for.
These very jobs and economic growth are exactly what's at stake in the energy policy battles of 2012. That's why the oil and natural gas industry has pushed back against Interior's new regulations. They threaten the future of energy development on federal lands—and the job creation and economic growth that come with it.