Texas’ oil and gas production economy grew by 8.1 percent in 2007, according to Karr Ingham, an economist and author of the Texas Petro Index.
OK, so this is really a replica of Spindletop spraying water.
Total production value for oil and gas in Texas in 2007 was nearly $65 billion, according to the TPI, a compilation of oil and gas price data, rig counts, employment and other factors gathered by the Texas Alliance of Energy Producers for the past 13 years. E&P employment in Texas was up almost 10 percent.
The 2006 results were also a record, but at the time there was some question as to whether there would follow a sharp dip that accompanied prior peaks in the index in November 1997 and August 2001. Clearly that was not the case.
The growth shouldn’t really be that much of a surprise, given what’s happened to oil prices in the past year. Or should it?
Most of the drilling in Texas is for natural gas — 63 percent of well completions were gas well completions in 2007. And natural gas prices traded in the same price range from 2006 to 2007.
But drillers continued to respond to the high oil prices, even though they did not appear to have much influence on natural gas prices, Ingham said.
A few other notes from the TPI:
• The rig count in Texas increased more that 10 percent and is approaching 900
• E&P jobs account for 2 percent to 3 percent of all Texas jobs
• E&P economy in Texas accounts for some 10 percent to 12 percent of the overall Texas economy
• 20 percent of all state taxes are directly related to E&P