US oil and gas benefited from the economy despite the challenges

Mella McEwen, MRT.com/Midland Reporter Telegram

January 31, 2023

Oil rigs and wind turbines near Interstate 20 in March 2022 in Stanton, Texas. MANDATORY CREDIT: The Oilfield Photographer, Inc.

The Oilfield Photographer Inc./The Oilfield Photographer, Inc.

A detailed study of the state of energy in both the US and Texas has been published by the Texas Independent Producers & Royalty Owners Association. The association offered its eighth annual analysis of national and state trends in oil and gas employment, wages and other key economic drivers for the energy industry in 2022.

“Despite a unique set of challenges, including supply chain bottlenecks, inflationary pressures, labor shortages and a contentious federal policy environment, the U.S. oil and gas industry continued to provide significant economic support in 2022,” said Jud Walker, chairman of TIPRO and president and CEO of EnerVest Ltd in a statement.

According to TIPRO, the industry supported a total of 948,943 direct jobs in the US last year, with a total of more than 19 million direct and indirect jobs associated with the industry. The US oil and natural gas sector paid an average national annual wage of $120,665 in 2022, 74% more than average private sector wages. Payroll in the US oil and gas industry was now US$114 billion and direct gross regional product (GRP) was US$854 billion in 2022, or about 3% of the US economy.

“Oil and natural gas development led by Texas operators will, in any realistic scenario, play an important role in meeting growing global energy needs for decades to come,” Walker added.

What does Oil & Gas mean for Texas?

• Texas is the national leader in the oil and gas industry, employing 347,828 people in this industry. About 37% of all oil and gas jobs nationwide were in Texas last year.
• Including direct, indirect and induced oil and gas employment multipliers, the industry supported a total of 2.6 million jobs in Texas last year.
• Texas was the leading state in 2022 by employment in every single sector except natural gas distribution (California).
• Oil and gas jobs in Texas paid an average annual wage of $139,061, 103% more than the average private sector job in the state.
• Texas had the highest oil and gas wage bill in the country in 2022 ($48 billion), California came a distant second ($11 billion), then Louisiana ($7.6 billion).
• Texas oil production was 1.83 billion barrels in 2022. New Mexico had the second highest oil production at 534 million barrels, followed by North Dakota at 393 million barrels produced.
• Texas led the country in natural gas production with record production of 11.2 Tcf in 2022, followed by Pennsylvania with 7.6 Tcf.
• Texas had the highest number of rigs in the country in 2022 with an average of 380 active rigs. The number of oil rigs in Texas increased from 332 in January 2022 to 410 in December 2022.
• In 2022, the total direct regional gross product of the Texas oil and natural gas industry was $322 billion, or 16% of the Texas economy. Once the typical gross regional product multiple is factored in, the Texas oil and natural gas industry supported 40% of the Texas economy.
• The Texas oil and natural gas industry acquired US$264 billion worth of US goods and services, 82% of which came from Texas companies.
• The Texas oil and natural gas industry paid a record $24.7 billion in state taxes and state royalties in 2022.

Mella McEwen is the Oil Editor at the Midland Reporter-Telegram.