Texas Energy is Even Bigger Than You Think
- May 6, 2014 12:00 pm GMT
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Crude oil reserves in the U.S are at their highest levels in nearly four decades. According to data recently published by the U.S. Energy Information Administration, the U.S as a whole added 4.5 billion barrels of proved reserves in 2012. Texas alone was responsible for nearly two-thirds of that increase. This is due in large part to reserves in the Permian Basin and other areas which were once thought to be too expensive to pursue. Thanks to continued advances in drilling technology as well as stubbornly high prices for crude oil, this is no longer the case. The fact that the oil boom is back in Texas is not news. Still it's remarkable to see how the Texas energy sector continues to accelerate. By some estimates, Texas will soon be producing more oil than most OPEC nations.
Texas is also a large and growing producer of natural gas. The U.S. has seemly overnight become a natural gas giant and Texas is the largest producer of natural gas in the U.S. Just a decade or so ago, the country was investing billions of dollars to put in place the infrastructure and facilities to import natural gas on a massive scale. Now the county is preparing to become an exporter of LNG. There too, Texas will be in the forefront. The Port of Houston is currently undergoing a $150 million dredging project to allow bigger ships to dock. The port is also a likely location for a LNG export terminal.
The ripple effects of cheap natural gas produced in Texas and elsewhere in the country cannot be overstated. Energy independence changes the U.S. footing on the international stage. But in Texas the impact is more direct and measurable. The multi-year energy boom is a contributing factor in the booming Texas economy. The Texas oil and gas industry employed nearly 400,000 people in 2012.
Natural gas is the single largest source of electricity in Texas. The abundance of natural gas brought about by new drilling techniques and the corresponding drop in price, has considerably brought down the cost of electricity in Texas. This has a direct impact on not only individual consumers but lowers the cost of doing business in Texas; further fueling the economy.
Hydrocarbons are not the only thing driving the growth of the Texas energy sector. Quietly, Texas has become a leader in renewable energy. Based primarily on the open plains of West Texas, wind turbines in Texas produce more wind power than any other state. In fact, Texas produces more wind energy than all but a few countries in the world. Despite this, wind energy is set to enter a new growth phase in the state thanks largely to the recent completion of a multi-year, multi-billion dollar project to install massive transmission lines to carry wind produced electricity from the western part of the state to the more populous eastern part of the state which includes the Dallas and Austin areas.
Perhaps one area of underachievement in Texas is in solar energy. Where, despite huge potential because of the state's sunny climate, solar energy has yet to take hold. However, there are grass roots efforts to kick state the state's solar industry, and there is optimism that the state will soon be able to take advantage of opportunities in solar.
Texas is one of the world's largest oil producers, one of the world's largest natural gas producers, one of the world's largest wind energy producers, and has one of the world's largest independent electricity grids. You have always known energy was big in Texas, but it's now probably bigger than you realized.