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Denver Business Journal - More Oil and Gas Leases Would Bring More Jobs


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By Representative Mike Coffman

Although the effect of production levels on the price of oil can be debated, what cannot be argued is that increased energy production here in the United States will create jobs and boost economic activity. We have endured 38 straight months of higher than 8% unemployment. Over 12% of veterans who served in Iraq or Afghanistan are unemployed. We need an energy policy that gets people back to work.

Although the President often boasts about his energy record, this Administration only approved 11 oil and gas leases in Colorado in 2011. In 2006 there were 363 approvals. Given the potential in increased jobs and money our potential resources provide, it is frustrating that this Administration has been so fervently against development. We in Colorado understand the importance of harnessing our own resources and the value it provides to our economy. The oil and gas industry in Colorado directly employs 50,000 people and supports over 190,000 jobs in the state. The industry is responsible for roughly 6% of total employment in Colorado. We cannot survive economically with 11 new leases.

The experience of North Dakota, where the unemployment rate is just 3%, shows what a thriving oil and gas industry can do. On private lands, new shale oil reserves are being produced, jobs are being provided, and wealth created. This can be a model for the country, and we could see this type of economic boom in Colorado, and across the West, on both private and public lands.

The World Economic Forum (WEF), in their report on Energy for Economic Growth, forecasts that in the United States the oil and natural gas industry will achieve average annual growth in the of 6.9% through 2015, compared to the overall real GDP growth forecast of 2.6%. The oil and gas extraction industry alone added approximately 150,000 jobs in 2011, which was 9% of all jobs created in the United States that year. Why are we not trying to spark this type of growth, more than twice the national average, in Colorado, and other western states?

It should be noted that these jobs are high paying and produce substantial economic benefits for communities according the study by WEF. Americans working directly in the oil and gas sector are currently paid an average of $28.30 per hour -- more than in the manufacturing, wholesale trade, education, finance, and information technology sectors. Moreover, investment in this industry spreads widely through the economy by creating tens of thousands of indirect jobs, especially in manufacturing. Oil and gas development requires drilling rigs, trucks, and other equipment to drill and complete wells; plants to process oil and gas before transportation; and pipelines to move products to market or to refineries. We have plenty of hard working individuals in Colorado who would jump at the opportunity to fill these well paying, steady jobs.

Unfortunately, Colorado's energy resources lay predominately on federal lands. Energy developers must deal with an inflated leasing and permitting timeline. On private lands in North Dakota, it takes 40 days to receive a permit to drill, but with federal lands it takes an astounding 298 days. Further, according to the Western Energy Alliance, there are roughly 1,631 outstanding projects on federal lands, including lands in Colorado, which are delayed over three years and federal regulatory delays to these projects prevent the creation of 64,805 jobs, $4.3 billion in wages, and $14.9 billion in economic impact every year.

Recently, the House of Representatives passed with bipartisan support the Domestic Energy and Jobs Act of 2012. This bill includes proposals from my fellow Colorado Representatives on the Natural Resource Committee and I that will help create jobs in Colorado.

Specifically, my portion of the bill mandates that the BLM return to the previous levels of leased acreage for the purpose of exploring for energy development. Historically, roughly 30% of available acreage has been leased, but in 2011 only 3% was actually approved by the BLM. My part of the Domestic Energy and Jobs Act will ensure steady, reliable exploration of our abundant resources every year, and the new jobs that come with expanded energy development.

Even with today's misguided policies, which confine most of Colorado's energy production to state and private land, almost 23,000 jobs in Colorado are supported by energy and mineral development in federal areas. Just imagine the thousands of new jobs that could be created with a federal lands policy that makes sense -- one that encourages, rather than restricts domestic energy production. In fact, if the federal government simply restored the permitting levels that existed from 2007-2008, more than 17,000 Colorado jobs could be created by 2015 according to the American Petroleum Institute.

The tonic to our ailing economy is to unleash the vast amounts of domestic resources we have in the United States. Encouraging this activity will provide more jobs, more economic growth, and more revenue for the government. We need jobs and economic growth to get this country back on track and increased domestic energy production will provide both.

I have worked with my colleagues in the House of Representatives on the Domestic Energy and Jobs Act because I understand that the unnecessary government bureaucracy must get out of the way in order to provide certainty and accessibility to the process of energy development. I was happy that this measure passed the House of Representatives with bipartisan support, but for it to actually help Coloradoans it must also pass the Senate. Everyone understands we need jobs, and unleashing onshore energy production is the answer.

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