Unconventional Natural Gas: An Economic Driver for the United States Economy

Open Access
Author:
Mattson, Trey Eric
Area of Honors:
Finance
Degree:
Bachelor of Science
Document Type:
Thesis
Thesis Supervisors:
  • Russell Paul Chuderewicz, Thesis Supervisor
  • James Alan Miles, Honors Advisor
Keywords:
  • natural gas
  • economy
  • unconventional
  • shale
Abstract:
The United States is the largest consumer of energy in the world and has been for many decades. Due to the country’s massive energy needs and lack of long-term energy policies, the United States has become reliant on foreign petroleum. This dependence on foreign energy threatens our national security and the domestic economy. It is imperative for our nation to decrease the dependence on foreign oil and we must begin to establish an energy strategy for the future. Unconventional natural gas gives the United States the opportunity to stimulate our economy while simultaneously decreasing our dependence on foreign oil. The United States lies directly above one of the richest natural gas patches in the entire world, although most of this gas is contained in a rock formation known as shale. Until recently, this shale gas was difficult to extract and the drilling process was extremely expensive. A number of technological advances have given drilling companies viable extraction techniques for this unconventional shale gas. Before these drilling methods were fully harnessed, the United States was projected to run out of natural gas in the next few decades. Currently, estimates place our natural gas supply at approximately 100 years due to the large amount of shale gas and effective drilling techniques. This study will offer a comprehensive analysis on the economic potential of the natural gas industry over the near term future. Benefits of increased gas production include job creation, stronger economic growth, the potential of exports and balance of payments benefits, decreasing our dependence on foreign oil and many other factors. The following analysis will demonstrate that, with appropriate commitments by the federal government and private corporations, natural gas can become an economic driver for the future of our country and create a much more stable domestic energy environment.