Report: Texas oil and natural gas industry breaks records in every category in 2022

(The Center Square) – The Texas oil and natural gas industry once again led the U.S. in oil and natural gas production and lowered emissions. It also ranked first in industry job growth, wages, payroll and Gross Regional Product (GRP) nationwide.

States that ranked second weren’t even close by comparison, a new report published by The Texas Independent Producers & Royalty Owners Association (TIPRO) found.

In 2022, Texas was the top oil producer in America, supplying 1.83 billion barrels of oil to energy markets last year. New Mexico produced the second-greatest amount – less than one-third of Texas’ production of 534 million barrels, followed by North Dakota’s 393 million barrels.

Texas’ nearly 350,000 oil and natural gas workers represent the greatest percentage of jobs in the industry nationwide of 37%, according to the report. However, when “incorporating direct, indirect, and induced multipliers for oil and gas employment,” the Texas oil and natural gas industry supported at least 2.6 million Texas jobs last year, the report notes.

Texas also led every state by employment in every single sector in the oil and natural gas industry last year with the exception of Natural Gas Distribution, which California led.

The average annual wage in the industry last year was $139,061, 103% greater than the average private sector job statewide. By comparison, the highest average industry wage earned nationwide was in Alaska of $169,018; South Dakota’s was the lowest of $74,665.

Last year, Texas had the highest oil and natural gas payroll in the country of $48 billion, the report notes. California’s $11 billion ranked a distant second, followed by Louisiana’s $7.6 billion.

Nationwide, the industry supported 948,943 direct jobs, with total direct and indirect jobs tied to the industry exceeding 19 million. The U.S. oil and natural gas sector paid a national annual wage averaging $120,665 during 2022, 74% higher than average private sector wages, according to the analysis. The national average was still $20,000 less than Texas’ annual average industry wage.

Texas also had the highest number of oil and gas businesses in the nation last year totaling 12,306. That’s three times the number of oil and gas businesses than second-ranked Oklahoma.

In 2022, total GRP for Texas’ industry was $322 billion, or 16% of the Texas economy. However, once the typical multiplier for GRP was incorporated, the industry accounts for 40% of Texas’ economy.

The Texas oil and natural gas industry also fuels Texas businesses. According to the analysis, industry companies purchased $264 billion worth of U.S. goods and services, 82% of it came from Texas businesses.

By comparison, nationwide, industry payroll totaled $114 billion; direct GRP was $854 billion in 2022, or 3% of the U.S. economy. Total U.S. goods and services purchased by oil and natural gas companies last year exceeded $744 billion from over 900 business sectors, the report found.

Texas also broke a new record in natural gas output last year with over 11.2 trillion cubic feet (Tcf) of gas produced, followed by Pennsylvania’s 7.6 Tcf.

“Production in the Lone Star State is helping to change the world by providing access to this foundational, low-carbon fuel source,” the report states. It did so as it broke records with reduced methane emissions intensity in the Permian Basin by over 76% as it increased production by 345%, according to a separate report on emissions data worldwide.

Texas’ natural gas industry record helped catapult the U.S. to become the world’s largest exporter of LNG, providing a lifeline to European countries experiencing an energy crisis.

It did so “despite facing a number of unique challenges, including supply chain bottlenecks, inflationary pressures, workforce shortages and an adversarial federal policy environment,” Jud Walker, chairman of TIPRO and president and CEO of EnerVest, Ltd., said. “Oil and natural gas development, led by Texas operators, will play an important role in meeting growing global energy demand for decades to come under any realistic scenario,” he added.

In 2023, the EIA projects that natural gas production will expand in the Permian Basin in west Texas and southeast New Mexico after five pipeline projects are completed.

The Texas oil and natural gas industry also paid $24.7 billion in state taxes and royalty payments last year for the first time in Texas history.


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