Texas Economic News: Fracking Could Bring Back Glory Days
The following is a digest of an article from CNBC.com.
Historically Natural Gas has always trailed behind Crude Oil in the Texas Energy world. But the advent of fracking shale gas has pushed this resource to the forefront.
Texas is already the nation’s largest provider of Natural Gas, and fracking is bringing new life into old Texas cities, whose glory days were in the middle of the last century.
“Cities like Midland are poised to see a big comeback,” says Andrew Coleman, managing director at Raymond James. “The Permian Basin was like OPEC in the 1930s and 1940s.”
“The easy stuff to get was the oil,” adds Coleman. “But now they’re going back for the gas. There were places in West Texas that became ghost towns after the easy stuff was gone, but now fracking and other technology is poised to bring people back to places like Midland.”
A lot of people think the advent of fracking and shale gas reserves is going to be a game changer for Texas economics in the 21st century. A study by IHS Global Insight says that fracking could bring 1.5 million jobs to texas by 2015, with another 900,000 by 2035.
Supporters of this view think this is the biggest economic upturn in 200 years and could allow Natural Gas to make our country independent of other fossil fuels.
Not everyone shares this view. Some believe that the amount of Natural Gas in the ground has been greatly overestimated to encourage development and investment in fracking.
“There are just a few people getting rich off this, but residents have been bombarded with advertising telling them they’ll be the next Jed Clampett,” says Young, referring to the patriarch of the 1960s TV show “Beverly Hillbillies.”
And there are environmental concerns as well. The jury is out on whether or not fracking might damage fragile water reserves below ground. Opinions on this seem to be split along expected lines, with Republicans and those interested in the revenue and jobs fracking creates claiming that groundwater contamination fears have been inflated, and Democrats and environmentalists calling for extreme caution and more studies.
Setting aside questions of how many years of Natural Gas supplies lie below Texas or how dangerous this is for our water supply, there doesn’t seem to be any question that if the price as natural gas rises, the political, economic, and environmental landscape of Texas could change substantially. Small towns will clamor for the influx of jobs and tax revenue that fracking brings.