According to the Annual Energy Outlook just published by the Energy Information Administration on February 3 rd , total delivered energy in the U.S. for all uses and in all forms combined, as measured in British Thermal Units, will not return to pre- pandemic levels until at least 2024 and perhaps not until 2029 or later. While refinery utilization and petroleum exports are expected to recover somewhat more rapidly, domestic gasoline and ethanol consumption are not expected to reach pre-pandemic levels for even longer, if ever. Retail prices for gasoline and diesel are projected to take several years to return to 2019 levels. As noted in our original white paper, the importance of the mining and extraction sector is not spread evenly across Indian country. For some tribes it is a critical component of their economies, whether directly or indirectly. For others, it is all but irrelevant. For tribes that are more dependent on the mining and extraction sector, their own economies will continue to suffer doubly, both from the direct loss of business and from the impact of lost demand for other sectors due to lost employment and earnings in their area. According to data from the Department of Interior Office Natural Resources Revenue, payments for mining and extraction on Native American lands dropped 13.9 percent in 2020 from 2019, a loss of over $157 million. Based upon the assumptions about the course of the pandemic described previously and our analysis of information currently available, we estimate that tribal revenue from the mining and extraction sector fell 25.9 percent in 2020. For 2021, we now forecast an increase in tribal mining and extraction revenue of 13.8 percent from 2020 levels as a slow recovery begins, still leaving the industry 15.6 percent below estimated 2019 levels. In 2022, recovery is forecast to continue, with revenue up 13.0 percent from 2021. This still leaves industry revenue 4.7 percent below estimated 2019 levels. We still believe that revenue in 2023 will approximate pre-pandemic levels and surpass them on a month-to-month comparison basis by the end of the year. This information is presented in the graph on the following page. Construction As we have discussed in prior editions of this white paper, construction typically lags other sectors in both decline and recovery due to the advance planning and inertia associated with large-scale development projects. The current crisis shows the same general pattern, but with the effects exaggerated by public health restrictions on one side unevenly counter balanced by government relief/stimulus spending on the other. Some projects already in process that would normally have been completed, even in a recession, have been suspended in mid-stream. At the same time, as government stimulus efforts and surprising resiliency in consumer and business behavior have been observed, a surge in spending in the second half of 2020 was observed in residential construction and renovation, along with CARES act spurred non-residential building. The net effect now appears to be a similar pattern to what was previously expected, but with a faster resumption affecting 2020 numbers.
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