Louisiana's oil and gas impact huge, economist says

07 11, 2014 by The Daily Advertiser

Louisiana's bustling energy sector is generating "economic activity like I've never seen in 40 years," says economist Loren Scott.

A 51-page report compiled for the Louisiana Mid-Continent Oil and Gas Association details the growth and points out how the state and local governments benefit from having the oil and gas extraction, refining and pipeline industry.

"If you want to see what Louisiana would look like if we didn't have oil and gas, just look one state to the east," Scott said a press conference where he released his study.

Highlights of the study show that the industry is responsible for 300,000 jobs that are spread across every parish in the state, that Louisiana is the second highest producer of both crude oil (counting offshore) and natural gas and has the second largest refining capacity in the country.

The industry has a $73.8 billion economic impact on the state and contributes $4.2 billion in state and local taxes and fees.

The industry has 64,669 direct employees, the survey found, with salaries totaling $5.9 billion a year.

Scott said 65,000 is the population of the Alexandria Metropolitan Service Area and more than the population of Acadia Parish, which is the 18th most populous parish in the state.

A map of pipelines in Louisiana leaves little of the state uncovered. Scott said there are 112,000 miles of pipelines "enough to circle the globe four-and-a-half times."

Lafayette is the city and parish most reliant on the industry, he said. The parish has 16,179 workers directly employed in the industry, the highest in the state, although there's little oil and gas activity there.

Because of that, it's also the parish that's most susceptible to fluctuations in the industry.

"Lafayette people have been through many booms and busts so many times they know to store their acorns," Scott said.

Scott did his first study for Mid-Continent in 1996 and has previously updated it in 2002, 2007 and 2010.

He said that in 1997, only about five states had natural gas production. With new drilling technology, about 20 states are producing natural gas in huge amounts.

Chris John, president of LMOGA, said the industry has grown nationwide to the point that "We are today energy secure…This is a whole new industry and I am proud of being a part of it."

Sasol, which is building a huge plant in the Lake Charles area, and other companies building natural gas facilities "aren't coming here because of our low humidity and cool summers," John joked. They're coming because of the availability of plentiful low-cost natural gas.

He recalled that as a member of Congress he testified to help Cheniere Energy get a permit to import natural gas because the price was so low. "Now, as president of Mid-Continent, I assisted in getting them an export permit."