7 Incredible Numbers From America's Energy Revolution
In October, energy consultancy firm PIRA announced that the United States has surpassed Saudi Arabia as the world's largest energy producer. It was only the latest achievement for the U.S. oil industry, which has transformed the global oil trade.
Since the advent of new technologies like horizontal drilling and hydraulic fracturing, the U.S. energy boom has produced some awe-inspiring statistics. Here're the seven most incredible numbers from America's energy revolution.
1) 12.1 million barrels per day
Over the past four years U.S. energy output -- including oil, natural gas, and biofuel -- has increased by 26% to 12.1 million boepd. Almost all of this can be credited to new shale plays like the Bakken, the Eagle Ford, and the Marcellus.
According to the IEA, the U.S. is expected to surpass Russia and Saudi Arabia in oil production by 2017. If current trends continue, America could become completely energy self-sufficient by 2030.
2) 1,200 rigs
You can thank the success of horizontal drilling for much of America's energy boom. In 2000, there were fewer than 50 horizontal drilling rigs in the U.S. Today, however, there are more than 1,200 in service across the country.
Scott Sheffield, Chief Executive of Pioneer Natural Resources , pointed out in a recent conference call that within six months, a single horizontal well in the Permian Basin produced 140,000 barrels of oil equivalent. A typical vertical well takes 30 to 40 years to reach that same figure. The company isn't just pulling production forward, though. It is also accessing new supplies that would have never been recoverable before.
3) 2.1 million jobs
According to a study conducted by IHS, America's shale boom has created 2.1 million direct and indirect jobs. The research firm also estimates that unconventional drilling boosted the average annual U.S. household income by $1,200 last year.
4) $100 billion in investment
The challenge of surging production is building enough infrastructure to actually move and store all of this stuff. ITG and Tortois Capital Advisors estimate that midstream master limited partnerships have set aside $100 billion for capital expenditures over the next three years.
The other problem is that much of the crude bubbling out of the ground is light and sweet. However, over the past decade the refining industry has spent billions outfitting their facilities in preparation for heavy sour blends.
In response, Valero , the largest U.S. refiner, plans to increase light crude oil processing capacity at several U.S. Gulf Coast refineries. In 2015, Valero will start up new crude "topping units" at its 88,000 bpd Houston refinery and its 200,000 bpd Corpus Christi refinery.
5) 100 years of supply
Thanks to new drilling techniques, the latest estimate for America's natural gas reserves is 2,200 trillion cubic feet. And while this number is highly debated, those reserves could supply the country for the next 100 years based on current consumption rates.
6) $175 billion per year
Due to a combination of surging production and falling demand, the U.S. now only imports 40% of its daily energy consumption from foreign countries -- a 20-year low. For the first time in 50 years, America also became a net exporter of finished petroleum products in 2011. This shaved $175 billion off of the country's trade deficit last year.
7) 6.3 billion cubic feet per day
Liquefied natural gas, or LNG, and oil could be America's next export bonanza. In September, the Department of Energy granted conditional approval of Dominion Resources' Cove Point natural gas export facility. The company will be allowed to export as much as 0.77 bcfd for 20 years, and the project is expected to cost between $3.4 billion to $3.8 billion.
In total, the Obama Administration has given the greenlight to export 6.3 bcfd of LNG on four projects. That represents roughly 10% of daily U.S. gas output. But with emerging countries desperate for new supplies, expect more LNG export licences to be granted.
Foolish bottom line
The math is clear: The American energy revolution is the real deal. When you consider the scale of this development, this is shaping up to be one of the greatest investment opportunities of a generation.
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The article 7 Incredible Numbers From America's Energy Revolution originally appeared on Fool.com.Robert Baillieul has no position in any stocks mentioned. The Motley Fool recommends Dominion Resources. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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