Montana Petroleum Association, Inc. P.O. Box 1186
Helena, MT 59624
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Montana Petroleum Report

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Thanks again to all of our sponsors and attendees to the 2014 Annual Meeting of the Montana Petroleum Association, Aug. 25-27th

                                                 

Our Keynote Speaker, Alex Epstein, founder of the Center for Industrial Progress is taking pre-orders for his book the Moral Case for Fossil Fuels at moralcaseforfossilfuels.com. We strongly recommend everyone to make the small investment in this game-changing guide to effective communication of the our industry. Want a shirt like ours, only $20.00 each. Email Sena.jessica@rocketmail.com to place orders! 

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2014 TREASURE STATE JOURNAL 

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The Economic & Fiscal Impacts of the
Oil and Gas Industry in Montana

Dr. Scott Rickard, MSU Billings Center for Applied Economic Research

 

"Montana's oil and gas industry produces incomes and revenues far larger than you would expect given its employment base, and it contributes proportionally more taxes and revenues than the typical Montana business," Dr. Scott Rickard

-In 2013, based on average first or wellhead prices, Montana oil and gas production was worth $2.6 billion dollars

-In 2013, three counties (Richland, Fallon, and Roosevelt) represented 80% of the 29.3 million barrels of crude produced in Montana

-In 2013, Montana's oil and gas industry added more than $2.3 billion dollars to the state's GDP

-Revenue from Montana's oil and gas industry accounts for 5.6% of the state General Fund, equivalent to an average Montana industry of twice or more its size

-In 2013, Montana's oil and gas industry contributed to over 15,600 jobs, paying two-thirds more than the state average

-Indirect employment contributions in 2013: Montana added an additional 4,900 jobs involved in selling goods and services to the oil and gas industry, including 150 new jobs in auto repair and maintenance, and 175 in accounting and tax preparation jobs

-Each oil and gas job contributes to Montana's GDP at four times the state averages

-In 2013, Montana's oil and gas industry contributed over $950 million in labor income and wages

-Average 2013 salaries for Petroleum Engineers in Montana was $99,379, and at the other end of the spectrum, extraction workers in Montana averaged $33,820

-Average pay in 2013 for Montana's petroleum industry was $66,599, more than twice the economy-wide average

-Less than half, 45%, of oil and gas positions in Montana are in the upstream (production) sector, while 55% are engaged in the downstream (refining and distribution) sector

-Montana's refining sector employed just over 1,000 people in 2013, and contributed to more than $1 billion dollars to state GDP

"Montana's oil and gas production industries contribute far more in taxes and revenues to state and local governments than the average business or employee," Dr. Scott Rickard

-The Montana Department of Revenue collects the oil and gas production taxes, retains a portion of the revenues for statewide purposes and distributes a majority of the revenues to the counties where the production occurred. The local distribution of production tax revenues fund county governments, K-12 schools, including student transportation, teachers' salaries and retirement, and community colleges

-Since the passage of the Production Tax Incentive (a.k.a. "tax holiday") production tax revenue collections have increased by ten times, from just around $25 million dollars in 1999, to $226 million last year

-Montana's oil and gas industry and the businesses which benefit indirectly generated nearly $350 million to state and local taxes in 2013; $226 million of that total came from production taxes alone

-In 2013, over $70 million of centrally assessed property taxes were paid and nearly $50 million in additional individual and corporate taxes

-Approximately 8% of Montana's oil production is on federal lands, 27% of natural gas production, and 4% of association gas production

-In 2013, O&G production on federal lands produced $41.7 million for Montana and local governments

"Expanding Montana's oil and gas production industry via increased exploration, drilling, and production benefits Montana's economy. For example, a recent estimate found that the drilling of an additional oil well which produces at the average rate adds $6 million in gross output over its lifetime, $2 million of which represents new contribution to state GDP. This new well would support an additional 11 jobs and $665,000 in new wages to the Montana drilling and extraction workers."

"State and local governments would also benefit, with this new well generating over $625,000 in additional state taxes and revenues."

-Dr. Scott Rickard


References:

Montana Board of Oil and Gas data

Oil prices based on Energy Information Agency 2013 average domestic crude oil first purchase price

Energy Information Agency

Natural gas prices based upon Annual Energy Outlook 2014 Henry Hub spot price for dry natural gas 2013 Average

Occupation Employment Statistics, US Bureau of Labor Statistics

Montana Department of Revenue

American Petroleum Institute's 2013 nation-wide analysis: Economic Impact of the Oil and Natural Gas Industry on the U.S. Economy In 2011

 

 


 



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