 The Montana Petroleum Report provides information of interest to Montanans. We encourage you to forward this e-letter to your friends.
— Dave Galt, Executive Director www.montanapetroleum.org
Montana Oil and Gas Industry:
Energy, Jobs and Revenues for the State
 Oil and gas is vital to the United States and to the state of Montana. Its development and production help power the national economy and provide good jobs for thousands of Montanans. Taxes paid by 170 energy companies in Montana help sustain quality education and bolster the state’s revenue base.
The oil and gas industry saw robust growth in the past decade due to technological advances in horizontal drilling and hydraulic fracturing -- industry practices that provide for safe recovery of oil and gas from two major “mature” fields in Montana. The Bakken formation and the Cedar Creek anticline are enjoying extended lives through application of these proven technologies, and they will continue to support Montana’s economy and America’s energy security for years to come.
The Montana Petroleum Association (MPA) provides a unified voice for the state’s diverse energy industry. It works with elected officials, regulators and communities to support a business climate in which companies can invest in exploration and production of oil and gas while continually improving their environmental and safety responsibilities.
Since its founding in the 1920s, MPA has represented the three sectors of the petroleum industry in Montana:- Upstream – exploration and production
- Midstream – pipeline operations and commodity marketing
- Downstream – refining and petroleum product wholesale and retail sales
In addition to the jobs supported, royalties paid and tax revenues generated by the industry, a significant share of the energy produced in Montana stays here, used in homes, businesses, schools, hospitals, transportation and ranches.
Petroleum is also a key ingredient in hundreds of consumer products, from bicycle tires to skis to guitar strings.
Petroleum business key to Montana’s future
Montana’s economy is shaped by the petroleum industry – a major employer and revenue producer.
“With a total economic impact of over $9 billion and over 12,000 jobs directly or indirectly supported, Montana’s oil and gas industries are a significant force in Montana’s economy. While production is concentrated in the eastern and northern parts of the state, over $450 million in taxes and revenues feed into state and county budgets, which benefits everyone.”
–Scott Rickard, Ph.D. Center for Applied Economic Research, Montana State University-Billings.
Montana is the tenth-largest crude oil producer in the U.S. In recent years Montana’s 4,200 oil wells produced 100,000 barrels per day. Significant volumes of natural gas are also produced here. In 2008, nearly 120 billion cubic feet of natural gas were produced.
Montana is also home to four refineries that have been operating at near capacity in recent years.
Through production taxes and royalties, the petroleum industry contributed significant revenues to the state, to the counties where oil and gas are produced, to public schools and to landowners and mineral rights owners. Over the past decade, oil and gas companies paid nearly $1.5 billion in production taxes alone.
The economic recession has resulted in fewer new wells in production. After steady annual increases for the past six years, taxes and royalties paid by the industry in 2009 will be less than in 2008. Given current conditions, now is not the time for new policies – federal or state – that could hamper investment in oil and gas and slow the pace of recovery in Montana and the U.S.
The MPA confers with members of government to evaluate the impact of existing and proposed legislation and regulations on the industry. It also supports development of independent research and analysis of economic conditions affecting all Montanans.
 Community investment
In addition to jobs and revenues, the oil and gas industry supports the communities in which it operates by investing in community organizations and helping to sustain community values. Education remains an industry priority, and MPA supports education not only through the production taxes it pays but also through activities such as co-sponsorship of an annual teachers workshop and sponsorship of an annual essay contest for high school students.
For more information contact Dave Galt, Executive Director, 406-442-7582.
The Montana Petroleum Association, Inc. is a voluntary, non-profit trade association, serving a membership of oil and natural gas producers, gathering and pipeline companies, petroleum refiners, service providers and consultants.
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