March 6 - The U.S. economy is starting to see the benefits of higher domestic energy production, and companies are starting to shift their strategies to take advantage of the trend. Bobbi Rebell reports.
It's boom times for the U.S. energy industry. Production in the country is surging, and imports are dropping. Crude oil imports, for example, hitting a 15-year low in 2012. That drop being driven by rising supplies from U.S. shale deposits and the Canadian tar sands. Bottom line: the U.S. could be energy independent by the end of this decade. ExxonMobil Chemical President Steve Pryor: SOUNDBITE: STEVE PRYOR, PRESIDENT, EXXONMOBIL CHEMICAL COMPANY (ENGLISH) SAYING: "For the first time in 10 years we have major capacity announcements being issued by a number of players equivalent to a 33 percent increase in capacity for ethylene which is the largest petrochemical building block." And that could add to the top line for American companies. IHS' Global Insight's John Larson: SOUNDBITE: JOHN LARSON, VICE PRESIDENT, IHS GLOBAL INSIGHT (ENGLISH) SAYING: "Lower energy costs lead to economic expansion and growth, and so what we've seen is we've looked at this, we've looked at the upstream activity and its contributions to the U.S. economy as an industry, and we looked at that and found that there are about 1.7 million jobs created last year in this unconventional oil and gas exploration activity - that will grow over the next year, eight years through 2020 to about 3 million, and by 2035 reach about 3.5 million." BNSF Railway is testing using natural gas to power its trains that now run on diesel. CEO Matt Rose: SOUNDBITE: MATTHEW K. ROSE, CEO, BNSF RAILWAY (ENGLISH) SAYING: "We could be looking at a very, very large capital investment in total of a full build out in the 5 to 7 billion dollar range so these are really big numbers for any railroad." For consumers, natural gas might be cheaper, but bargains for oil won't be as easy- because oil is a globally traded commodity and is impacted by factors outside U.S. borders. But speaking of borders, there are political benefits as well- for example with Venezuela, which is in a transition period after the death of Hugo Chavez: Nariman Behravesh is the chief economist at IHS Global Insight: SOUNDBITE: NARIMAN BEHRAVESH, CHIEF ECONOMIST, IHS GLOBAL INSIGHT (ENGLISH) SAYING: "Well, I think it puts us in a more secure position and in a better bargaining position when it comes to dealing with the Venezuela's of this world and other unstable sort of regimes. So in that sense, it's a positive thing for the U.S. from a geopolitical perspective." One key risk to independence: regulation as many states push back on efforts to expand fracking.