Oil Production, Petrochemicals Fuel Texas Economy
"World's Richest Acre" in Downtown Kilgore, TX
A historical marker stands on the "World's Richest Acre," in downtown Kilgore, Texas. Developed before well-spacing rules, this block, which is part of the East Texas Oil Field discovered in 1930 is the most densely drilled tract of land in the world.
The oil and gas industry employs almost 200,000 Texans.
There’s a reason oil is called Texas Tea. Crude oil and natural gas are produced in 218 of the state’s 254 counties, and Texas is home to 26 operating refineries that produce an average of 1 million barrels of oil per day.
More than any other industry, oil sets Texas’ economy apart, says William Ennis, vice president of the Texas Oil & Gas Association.
“An industry once written off by some has roared back to life in recent years, contributing record amounts to government coffers and creating some of the highest paid jobs in Texas,” says Ennis. “Texas’ oil and gas businesses have brought together technology, manpower and investment to keep the state No. 1 in energy production despite turbulent times in energy markets."
Oil and Gas Industries Influence Economic Development
The state's marketed production of natural gas represents one-third of the total U.S. supply. As an oil and gas producer, the state of Texas also is a global leader, contributing approximately 5.3 percent of worldwide refinery capacity. Natural gas production in the state exceeds 5 trillion cubic feet a year.
Under the threat of national and international economic and financial crises, Texas’ oil and gas industry has been the fuel keeping the state fiscally and economically resilient, he says, citing the association’s 2009 report.
How big is the industry’s economic impact? The oil and gas industry employs almost 200,000 Texans in jobs that pay an average of more than $129,000 per year, nearly triple the amount paid by by the average private-sector employer. Those jobs have a huge economic impact, but Ennis says an even greater benefit results from the industry’s ripple effect through the economy.
Purchases of machinery, pipe, concrete, steel, construction, engineering and legal services, land, electrical power and other expenditures have a powerful effect throughout the state, not just in the “oil patch.” The oil sector’s jobs and spending support other local businesses, such as banking, hotels, restaurants and dry cleaners. For every job created in petroleum refining, 14 additional jobs are created in other industries, Ennis says. The only industry that matches that amazing record is the petrochemical manufacturing business, which generates 17 additional jobs for every job it creates.
Chemical Plants and Related Jobs in Texas
Texas is home to 200 chemical plants that have $50 billion in assets and export products valued at $35 billion a year, says Hector Rivero, president and CEO of the Texas Chemical Council.
Texas represent two-thirds of the U.S. chemical market, he says, and accounts for 500,000 jobs in Texas, a number that includes contractors and suppliers as well as the approximately 70,000 people directly employed by the industry.
Those jobs are the ticket to a better life for many Texans, he says.
“Someone can graduate high school, get an associate’s degree or skills training, and have a very high quality of life. Our industry has been the economic engine that has allowed many people to have a comfortable life, have a nice house and two cars and send their kids to college,” he says.
Texas petroleum and chemical industries touch the lives of everyone in the United States every day, says Rivero.
“Think about everything in your home and car. People don’t know what we make, but we’re pretty much in everything,” he says.