Friendly business environment fuels U.S. oil boom, report says

A favorable business climate in the United States has helped make the country the world leader in the shale revolution, a report said Monday.

In the report, “Energy and the New Global Industrial Landscape: A Tectonic Shift?”, research firm IHS notes that shale gas and tight oil deposits are being discovered all over the world. However, the report adds that the U.S. has the  ingredients to help the industry flourish, including  private property ownership rights, good energy infrastructure and access to risk-based investment capital.

“This is primarily a story of market forces and entrepreneurship, not government incentives or intervention,” IHS wrote in the report.

Read more: Oil production to grow at fastest rate ever

IHS projected that growth in unconventional oil and gas will add more than 3  million jobs by 2020 and generate more than $110 billion in taxes. U.S. oil output has increased 25 percent since 2008 to about 6.4 million barrels per day.

Natural gas supplies also have surged, which has sent prices down, spurred  growth in the petrochemical industry and lowered electricity costs for steel, aluminum and glass manufacturing. Natural gas fuels power plants and other manufacturing operations. It also is a raw material for some petrochemicals.

As the boom continues and technology improves, Canada and the United States are expected to become exporters of liquefied natural gas and to increase their exports of petroleum products, petrochemicals, coal and fertilizer, the report noted.