Report: Booming Eagle Ford Shale created 48K jobs

SAN ANTONIO — The Eagle Ford Shale has been touted as a modern-day Spindletop, and a study released Wednesday underscored that view.

The vast oil and gas play in South Texas contributed $25 billion in total economic output to a 20-county South Texas region last year and provided 47,097 full-time jobs, according to a study by the Center for Community and Business Research at the University of Texas at San Antonio’s Institute for Economic Development.

In a single year — 2011 — the shale development added almost as much economic oomph to South Texas as an earlier UTSA study predicted would occur over nearly a decade. That earlier projection estimated the Eagle Ford would account directly and indirectly for almost $21.5 billion in economic output by 2020.

The new study estimates the shale will create 117,000 jobs by 2021, more than one-and-a-half times the 68,000 full-time jobs the earlier study had projected.

Thomas Tunstall, director of UTSA’s research center and the study’s lead investigator, said Wednesday’s study is the “first chapter” in its look at the shale. In late summer, the center will look at workforce issues and a third installment will provide more detailed county-by-county data.

UTSA officials said the earlier study was conservative, as is the current one. But shale production “has far exceeded the expectations outlined in the initial report because of rapidly evolving business activity,” the study said.

“The Eagle Ford will ensure growth for our community for decades to come,” said Curt Anastasio, CEO of San Antonio-based pipeline company NuStar Energy LP, who moderated a presentation of the study.

A frenzy of drilling is sparking the boom. Oil production in the Eagle Ford increased more than sixfold in 2011 from 2010, and natural gas production more than doubled in the same period, UTSA estimated using Railroad Commission data.

UTSA officials stressed the new study is a new “baseline” look at the effect of drilling in the shale. The current study examined 14 counties directly affected by drilling, along with six counties indirectly involved in the development. America’s Natural Gas Alliance paid $90,000 for the study.

In the 20-county region, the study estimated that $3.1 billion in salaries and benefits were paid to workers last year, and the shale impact amounted to $12.63 billion in gross regional product.

Also in the 20-county region, $257 million went into the coffers of local governments, while $358 million went to the state, including $120.4 million in severance taxes paid by drilling companies on production.

The 20-county region includes Atascosa, Bee, DeWitt, Dimmit, Frio, Gonzales, Karnes, La Salle, Live Oak, Maverick, McMullen, Webb, Wilson and Zavala counties, along with six counties that benefit from the drilling but don’t have production: Bexar, Jim Wells, Nueces, San Patricio, Uvalde and Victoria.

In the 14 counties directly affected, total economic impact last year was estimated to be almost $20 billion, while the development supported 38,000 full-time jobs and added $211 million to local government revenue.

And all the shale drilling translated to fatter paychecks. Most of the counties saw average weekly wages jump from about $450 to $550 a week to $600 to $700 a week, UTSA’s Tunstall said.

The growing importance of the shale was evident by the number of officials who attended the luncheon, including San Antonio Mayor Julián Castro, UTSA President Ricardo Romo, Texas House Speaker Joe Straus and Railroad Commissioner David Porter.

Earlier Wednesday, at a Real Estate Council of San Antonio breakfast at the Petroleum Club, Adam Haynes, senior director for corporate development and government relations at Chesapeake Energy Corp., estimated there’s at least 30 years of production in the Eagle Ford Shale.

Mark Witt, vice president and CFO of San Antonio-based Lewis Energy Group, said the natural gas production company has 1,000 employees and plans to add another 350 this year, with 50 of those jobs at its corporate headquarters.

Jennifer Hiller contributed to this report.

vvaughan@express-news.net

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