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Natural Gas Keeps the Manufacturing Industry Strong

By Lynn Cielec on 06/17/2016

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According to a new study, the U.S. manufacturing industry’s already high demand for natural gas is only growing. As the need for this precious resource increases, it’s more important than ever to keep natural gas operations strong.

A recently released National Association of Manufacturers (NAM) and IHS Economics study proves just how important natural gas and its pipelines are for the manufacturing industry and the U.S. as a country. Its applications for the industrial sector are wide-reaching, according to the report: manufacturers use natural gas “for fuel (including drying, melting, machine drive, space heating) and...feedstock use in the refining, chemicals and primary metals sectors.”

What’s more, the availability of lower-priced, domestically-produced natural gas has strengthened the industry, spurred growth, and created benefits for communities beyond the realm of manufacturing.

It’s no surprise then that demand for natural gas is expected to keep pace with the growth of the manufacturing industry and a mounting need for electric power. Let’s take a closer look at what the NAM report tells us about natural gas’ increasing importance in supporting local and national economies, and what the future may hold for the industry.

What the Study Reveals

Pertinent highlights from the study make it clear that natural gas is increasingly a force to be reckoned with:

  • In 2015, natural gas access contributed to the creation of 1.9 million jobs, with the construction and maintenance of new transmission lines resulting in more than 347,000 jobs alone.
  • Meanwhile, falling prices resulting from a current wealth of shale gas returned an extra $1,337 to the average American family, after the savings to utilities like heating costs were calculated.
  • Total natural gas demand is set to increase by 40% over the next decade, thanks to the key drivers of manufacturing and power generation. The domestic supply is expected to increase by 48% in the next 10 years to meet increased demand.
  • With energy innovation lowering production costs, the IHS expects energy-intensive industries such as chemicals, metals, food, and refining to outperform the U.S. economy as a whole through 2025.

As the study notes, much of the recent growth in natural gas use comes from the ready availability of domestic shale gas. IHS estimates increased domestic shale gas production and the correspondingly lower natural gas prices have had staggering economic benefits: a $190 billion contribution to the real gross domestic product (GDP), the creation of 1.4 million additional jobs, and an additional $156 billion in real disposable income. This precipitous growth has in turn lowered overhead costs and kept pipelines filled — to the point that an expansion of the pipeline network is urgently needed to handle greater supply.

“Over the next decade our nation’s demand for natural gas is only going to grow, and much of that growth is from manufacturing,” said NAM President and CEO Jay Timmons. “This study unequivocally shows that if our growing demand is not taken seriously by policy makers we will have a serious lack of infrastructure that will jeopardize our growth.”

Keeping Growth Sustainable

With all that’s in store for the natural gas industry, operators will need to keep expansion of both mining facilities and pipelines sustainable to ensure that work can continue uninterrupted, all with safety considerations in mind. For industrial solutions that protect the environment, they need look no further than Midwest Industrial Supply, Inc.

Midwest provides the oil and gas industry with solutions to make the extraction process more efficient by stabilizing surfaces and reducing dust, lowering maintenance costs across the board and helping to keep worksites compliant with environmental regulations. Given that natural gas is such a vital part of the manufacturing industry — and by extension, the whole U.S. economy — industry leaders can be certain that their sites are operating at their highest capacity with Midwest.

(Image credit: Bilfinger SE/flickr)

About Author

Lynn Cielec

Written by Lynn Cielec

Lynn Cielec is the Industrial Business Unit Manager at Midwest Industrial Supply. She is an experienced executive sales director with a proven track record of results and sales growth. Effectively utilizes consultative selling methodologies within a CRM system while incorporating other value based selling tools. Expertise in building and leading high performing sales teams, strategic planning, P & L management, new business development, compensation development, market/trend analysis, new product launches and multi-sales channel distribution.

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