Oil and gas production continues to be a key driver of Ventura County’s economy, including providing more than 900 high-paying jobs, but that could be under threat if the county adopts measures to limit production, according a new study funded by the Californians for Energy Independence.
Focusing on the county’s upstream operations, which is led by Aera Energy, the study’s authors projected that oil and gas production will drive more than $760 million in economic output, employ more than 2,000 people and provide $56 million in state and local fees and taxes.
However, those revenues could be threatened if voters approved measures to limit oil and gas production. While no measures have reached the ballot, the study’s authors concluded that future measures could have a devastating impact on the Ventura County economy.
“Future measures that ban oil production in the county would be counterproductive, in that they would eliminate these economic- and tax-related benefits, increase statewide dependence oil imports from remote markets and put the county at risk of major liability with “takings” lawsuits,” wrote authors Brad Williams and Mike Genest, of Capitol Matrix Consulting, which was commissioned by CEI to perform the economic study.
Ventura’s operators, including Aera, produced 7.7 million barrels of oil in 2016 – about 4 percent of the state’s production. Aera is the No.1 producer in the region with more than 4 million barrels of annual production.
The study excluded downstream operations, including refineries and gasoline stations, to focus on the impact made by the producers in the county. Aera has been the county’s third biggest property taxpayer from 2010 to 2016, while California Resources Corporation has been No. 4 – based on combined valuations of more than $1.3 billion – but the industry’s contributions are even greater when considering indirect tax revenue.
“The industry generates a considerable amount of tax revenue indirectly, as expenditures by oil companies, the households of their employees, their vendors, and mineral right owners generate additional sales, jobs, and income throughout the region,’’ the authors reported. “We estimate these multiplier effects result in an additional $18 million in state and local taxes per year.”
Additionally Williams and Genest said the industry directly employed 900 people with an average salary of $115,000 per year – more than twice the county’s average. The industry also indirectly employs another 1,200 people, but the study argues that job growth could continue in the sector.
Based on current and projected future increases in oil prices, we estimate that employment related to oil and gas production will rebound during the next several years, exceeding 3,000 jobs by 2023.
While many of these jobs are varied and technical, including those with advanced degrees, there are still jobs where those with high school diplomas can still earn a living that exceeds Ventura County’s median income.