Most people can’t think about Texas without thinking about oil, and a recent flood of investment into two onshore shale fields has helped the state bolster its title as one of the world’s leading energy producers.
According to the Texas Railroad Commission, the Lone Star produces about 1.7 million barrels of oil a day. That’s more than 52 million barrels a month. The American Enterprise Institute said that if the Texas were a sovereign nation, it would be the world’s tenth largest oil producer.
The Lone Star state has also seen a significant increase in natural gas production. Add it all up, and it’s easy to see why Texas has helped make the U.S. the world’s largest energy producing nation—surpassing Russia this year.
The energy boom has given the state’s economy a huge boost. Overall, 25 percent of employment in Texas is directly tied to the energy industry, and it generates about $12 billion a year in taxes.
According to the Bureau of Economic Analysis, Midland is the second richest metro area in the country—beating out Silicon Valley hubs San Francisco and San Jose.
Midland, home of the massive Permian Basin, boasts a per capita personal income of over $65,000. The national average is less than $42,000. Oil companies flush with cash are reinvesting in their businesses in the Midland area. Chevron, Concho Resources, EOG, Schlumberger and Pioneer Natural Resources are all building new headquarters in the city, spearheading a massive wave of new development in Midland.
The numbers from south Texas are even more startling. Ninety miles south of San Antonio sits the heart of the Eagle Ford shale fields. Analysis from the Federal Reserve Bank of Dallas suggests that this region is responsible for 1 out of every 50 jobs created in Texas.
Tiny towns like Cotulla have experienced population explosions. According to Mayor Jose Javier Garcia, Cotulla has grown from 3,500 people to 12,000 in just three years. In 2010, the city collected $615,680 in sales taxes. Through the first 10 months of this year, the figure is more than four times larger, at over $2.6 million.
It remains to be seen how well these boomtowns will manage their newfound wealth, but it’s unlikely that Texas energy industry will go bust any time soon. The IEA estimated that the U.S. will be a net exporter of energy by 2030, and will be nearly energy independent by 2035.
If those figures hold true, Texas is likely to be leading the charge.
—By CNBC’s Brad Quick. Follow him on Twitter @bquick83