Texas upstream oil and gas sector adds jobs, threatened by proposed natural gas tax association argues

By Bethany Blankley | The Center Square

The Texas upstream oil and gas sector added jobs for the fourth consecutive month in August. Roughly 178,500 more people reported working in the sector than in June, according to revised Bureau of Labor Statistics (BLS) data.

Compared to August 2020, upstream jobs added 18,500 jobs in the services sector and 1,200 in oil and natural gas extraction.

Strong job posting data for upstream, midstream, and downstream sectors for the month of August was in line with rising employment statewide.

In August, Texas added 39,300 total nonagricultural jobs, making gains in 15 of the past 16 months, the Texas Workforce Commission reports. Texas has added  681,000 jobs since August 2020. Its seasonally adjusted unemployment rate was 5.9% in August, a decrease of 0.3% from July 2021.

In August, the Professional and Business Services industry gained 29,600 jobs, followed by Education and Health Services employment with 17,800.

An analysis by the Texas Independent Producers and Royalty Owners Association (TIPRO) found that there are 57,185 total jobs available for the Texas oil and natural gas industry in August, of which 8,558 were unique. The numbers show a posting intensity of 7-to-1, meaning that for every 7 postings, there is one unique job posting.

The Crude Petroleum Extraction sector has the most unique jobs available in the industry at 1,664, followed by Petroleum Refineries with 1,608, and Oil and Gas Field Machinery and Equipment Manufacturing with 1,270.

The three cities with the most unique oil and natural gas job postings are Houston (2,815), Midland (532), and Odessa (447).

The three companies with the greatest number of unique job postings in August were Halliburton Company (618), Delek US Holdings, Inc. (563) and National Oilwell Varco, Inc. (533).

“Oil and natural gas demand is poised to surge over the next 6-12 months,” Ed Longanecker, president of TIPRO, said in a statement. “Bullish fundamentals set up oil prices and the industry for strong returns over the next few years, which will have a positive impact on industry employment and economic growth for our state and country.”

Despite TIPRO’s positive outlook, these gains might be lost if a federal national energy tax in the $3.5 trillion reconciliation package before Congress were to be passed. “It could cripple small Texas oil and gas operators and severely burden American taxpayers,” TIPRO says. The proposed policy is unbalanced, TIPRO argues because it proposes to tax primarily methane from oil and natural gas production, but doesn’t tax three of the top four methane-producing industries in the U.S.: agriculture, waste management, and coal sectors.

If implemented, the tax “would have a ripple effect through the entire U.S. economy, negatively impacting American jobs, domestic energy production, household energy bills and the cost of goods and services, including the price of gasoline,” Longanecker added. “The U.S. oil and natural gas industry has demonstrated its commitment to reducing emissions through innovation, collaboration and investment of hundreds of billions of dollars in greenhouse gas mitigating technologies throughout the value chain, and with quantifiable success.”