What is the value of oil and gas production to Kansas?
Estimates from the US Department of Energy (DOE) and the Kansas Geological Survey
put Kansas production at 50 million barrels of oil and at 686 billion cubic feet
(BCF) of gas in 1993. Estimates for 1994 are that oil production continued to
decline, and annual production was just under 47 million barrels. This is a 6.0%
decline from 1993, and is the lowest rate of oil production since 1934. Gas
production in 1994 increased to an estimated annual production of approximately
713 BCF (+3.8%). Using estimated 1994 average prices for oil ($14.71 per barrel)
and gas ($1.78 per MCF) in Kansas, the value of the oil and gas produced in the
state is approximately 1.95 billion dollars. This is a decrease in estimated
value of almost 200 million dollars from 1993. The decrease in total value is
a result of decreased oil volumes, and what is more important a decrease from the
average 1993 prices for oil ($16.93 barrel) and gas ($2.00 MCF).
The significance of Kansas oil and gas production relative to other parts of the
Kansas economy is illustrated by comparing the value of oil and gas production to
a product that is perceived as central to the Kansas economy. Over the past forty
years, the value of Kansas oil and gas production is comparable to the value of
total statewide crop production as measured by the cash receipts for all the crops
produced in the state.
Figure 1--Kansas Production--Crops and Oil and Gas.
A larger version of this figure is available (full version 12k).