In November 2013, the Fraser Institute of Vancouver, BC published their annual Global Petroleum Survey, an opinion poll ranking the business climate in the 157 major oil and gas producing areas of the world. This report was based on results of a survey that they sent to selected management and executive level folks in February – March 2013 using professional society membership lists. In all, opinions submitted by 842 respondents from 762 companies worldwide were tallied – a fairly small sample size.
A December 19th press release from Dave Spigelmyer, new president of the Marcellus Shale coalition said:
A recent survey by the Fraser Institute, an independent public policy think-tank, found that Pennsylvania’s regulatory and tax climate are a major deterrent for “attracting oil and gas investment.”
Where PA Ranks
We downloaded and reviewed the free 122 page report and found that PA is generally in the middle of the pack on O&G business friendliness issues.
- In “regulatory climate”, PA ranked only slightly worse than average – 86th best out of 157 regions (see fig 6 on page 38)
- In “taxation”, PA ranked better than many regions – 48th best from among the 157 regions (see fig 20 on page 88)
- In the “policy perception” category, the report said of PA “State government actively promotes the development of the resource.” (page 48)
- In overall investment barriers, PA ranked 68th best out of the 157 regions (see Table 1 on pages 16-20)
For our neighboring states, WV ranked 23rd and Ohio ranked 33rd in having the least investment barriers (Table 1)
The 10 US states with the least barriers to the O&G industry were Oklahoma, Mississippi, Texas, Arkansas, Kansas, Alabama, North Dakota, Louisiana, Wyoming and Montana. All of these states ranked among the 22 friendliest O&G regions in the world.
We’ve heard many opinions – From “PA is a good place for the O&G industry to do business and a great place to live” to “PA needs tougher environmental regulations and more tax revenue from O&G”.
As usual, it looks like the truth is somewhere in the middle.