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Experts: Shale Gas Won't Reignite U.S. Economy

Tuesday, 17 April 2012 07:53 AM

Shale gas is plentiful in the U.S., fueling hopes that the cheap fuel supply will create jobs, lower the country's energy bill and reignite the U.S. economy, but it won't, experts says.

Shale drilling for natural gas will help the economy, but the benefits won't be as impacting as many would like.

Shale's contribution to U.S. growth would come in less than 1 percent by 2015, and the jobs it would create would cut the unemployment rate to around 7.7 percent from 8.2 percent today, the Financial Times reports.

An unemployment of 7.7 percent is still way above pre-recession levels.

"It’s certainly a good thing for the economy," John Parsons, economist at Massachusetts Institute of Technology and a member of the university’s natural gas study group, tell the Financial Times.

"But it's not any magical elixir. It's not that large a segment."

Furthermore, the U.S. economy is less energy-intensive these days compared to the past and grows more on service sectors rather than on heavy industry.

Some say the country could export natural gas thanks to the size of the shale deposits and the use of new technologies associated with fracking, a drilling method environmentalists say pollutes both air and water.

President Barack Obama has issued an executive order creating an interagency group to oversee the development of natural gas, facing pressure from companies to produce more and even export it.

Energy industry groups praised the order, although some say it won't work.

"We don't need another working group, or any more bureaucracy," says Kevin Smith, spokesman for House Speaker John Boehner, according to Reuters.

"We need a president who will work in a bipartisan way on expanding American energy production to lower gas prices and create more jobs."

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Tuesday, 17 April 2012 07:53 AM
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