Economic benefits from Colorado's upstream and midstream oil and natural gas industry totaled $126 billion between 2008 and 2012, according to a study highlighted Thursday by the University of Colorado's Leeds School of Business.
The report done for the American Petroleum Institute quantifying economic and fiscal contributions details the tax revenue streams generated for oil/gas activity in each county, along with identifying the public services that the tax revenues supported in selected jurisdictions.
Pro-industry group Coloradans for Responsible Energy Development (CRED) immediately pointed to the study as "a big win" for the state, characterizing it as verifying that "fracking enriches your everyday life."
Jon Haubert, CRED spokesperson, said the industry, which has been revitalized through hydraulic fracturing (fracking), has provided "high-paying jobs, increased tax revenue, stronger classrooms, energy savings and more funds for public safety."
For example, the university study identified $202 million in 2012 from industry property taxes going to public schools, and $11.4 million in energy cost savings for the state's public schools (K-12), Haubert said.
In 2012, the report calculated that 31,900 workers were spread across the drilling, extraction, support activities, pipeline transportation and related construction sectors in Colorado, and overall the oil/gas industry supported 93,500 jobs, with direct industry workers making $3.2 billion in wages, twice the average for all industries in the state.
Oil/gas production in the state is concentrated in 38 of 64 counties with 88% centered in five counties alone in 2012 (Weld, Garfield, La Plata, Rio Blanco and Montezuma). "Despite this concentration, counties that are non-producers often participate in the supply chain, offering goods, services and a qualified workforce," the report said.
As an example, the report cited the city and county of Denver, which was classified as a small producer in 2012, but nevertheless recorded the largest number of industry jobs in the state as many of the oil/gas companies are headquartered there.
"The industry has the largest tax impact on producing counties, but oil/gas revenues impact nearly every citizen in the state through Colorado general fund expenditures on education, transportation and other public services as well as through severance tax and federal mineral lease distributions," the report said.
The report also looked at a tax paid by the oil/gas industry to the Colorado Oil and Gas Conservation Commission to support its environmental response fund and the commission expenses, along with calculating the income and sales taxes paid by industry workers and oil/gas companies.
In 2012, the report calculated that oil/gas workers contributed nearly $90 million in income taxes on collective earnings of more than $3 billion. Average wages in the five main categories of oil/gas jobs ranged from $65,000 to $133,000 annually in 2012, with the highest wages in the extraction ($133,335) and pipeline transportation ($110,000) job categories.