The US is in the beginning stages of putting itself back on top, decreasing the deficit, creating jobs, and boosting GDP growth. The driver of this growth is the burgeoning US energy revolution that’s taking place on our home turf.
Due to significant advances in technology, we now have the ability to drill horizontally as opposed to the traditional vertical drilling. Horizontal drilling, or hydraulic fracturing (“fracking’), is the process of extracting natural gas from shale rock layers deep within the earth. Fracking makes it possible to extract natural gas in shale plays that were once unreachable with conventional technologies. We are now realizing that we may have more resources than what we predicted, and if accurate, the US can become the top energy producing nation in the world.
To date, there has been growing activity in the South Dakota Bakken region, the Permian Basin in Texas, Marcellus Shale in and around the Northeast, and lastly Louisiana, where the proximity to the Gulf allows for the easy transportation of the resources. So what does this mean?
In all of the above mentioned areas, there has been significant activity, which in turn has created jobs. It not only is creating jobs for the companies that are drilling, but it has had a significant overall impact on the area. It’s creating demand for the build out of infrastructure around the working area for pipelines, transport, and storage of the natural resources. It also is creating housing demand. All these areas are seeing low levels of unemployment and increased economic activity. Ultimately, I believe this momentum will propel the job growth and GDP engine, as we rely less on importing resources from overseas, increasing exports, and meaningfully reducing the deficit.
Some ideas to think about…
• Companies that are producing the natural resources
Please contact John J. Fiorito at 212-785-4377 to discuss investment opportunities that may benefit from the US Energy Revolution.
John J. Fiorito
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