Oil and Gas Extraction (Purchasing Industries)

Hi All, I've looked at other posts and cannot find an answer to this. Any thoughts will be greatly appreciated. But I noticed in both the 2009 and 2013 data for the U.S. the only purchasers of Oil and Gas Wells (sector 3037 in 2013 data) is capital (14001). That is there exist no intermediate demands, only institutional demand of capital. I found this by going to the Commodity Balance Sheets, which essentially read across the rows of the Use and Absorption tables. So why exactly are we not seeing refineries as a purchaser of Oil and Natural Gas Wells? Many thanks, Steve
Was this post helpful?
0 out of 0 found this helpful


1 comment

  • Hi Steve, That is a great question. You won’t see demand for oil and gas wells from refineries because refineries are demanding the extracted oil and natural gas that comes from the wells (3020 and 3021). Which of course leads to the question, then why doesn’t Sector 20 or Sector 21 generate the demand for wells? The spending patterns that you see in the Explore> Social Accounts> Balance Sheet (Tab), and View By: Industry Balance Sheet and the Commodity Demand tab, from which the Explore> Social Accounts> Balance Sheet (Tab), View By: Commodity Balance Sheet and the Industry Demand tab are derived shows only the products that are consumed year-over-year as part of the production of the extracted oil and natural gas, thus items like Maintenance & Repair of the wells, electricity to operate them, etc will be part of the spending pattern but the one-time investment of well-drilling is not considered a year-over-year expenditures and thus the purchase of wells is not part of operational spending pattern but of capital investment. In IMPLAN, we don’t have a separation of capital investment by Industry, thus this general Institutional definition of capital makes the purchase of gas and oil wells. The detailed SAM however, does have capital purchases of commodities by type of commodity purchased, but not by industry purchasing.

Please sign in to leave a comment.