Mr. Erik Milito - The House Committee on Natural Resources ...

January 2012
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CONCLUSION
<strong>The</strong> Western U.S. experienced a decline in oil and natural gas leasing, permitting, and new drilling on federal lands during
2009 and 2010 relative to previous years. Preliminary leasing data suggests that the downward trend has continued into
2011. This is expected to result in a reduction of domestically produced oil and natural gas, a loss of thousands of jobs
in both energy and non-energy sectors of the economy, and the surrender of hundreds of millions of dollars in state and
federal tax revenues, royalties, and lease payments to western states and the U.S. Treasury.
In sum, returning to permitting and leasing levels experienced in 2007 and 2008 would:
Increase Western U.S. natural gas production by an average of 516 billion cubic feet per year
2012 to 2015.
Increase Western U.S. oil production by an average of 9.9 million barrels per year 2012 to 2015.
Direct employment increases in the oil and gas industry in energy producing western states of 4,085
jobs in 2011, 6,914 jobs in 2012, 9,937 jobs in 2013, 9,713 in 2014, and 9,032 in 2015.
Increase total employment in energy producing western states over the next four years by an annual
average increase of 24,298 total jobs.
Severance and ad valorem taxes would increase by over $1.2 billion from 2011 to 2015.
Federal royalty would increase ranging from $106 million to $670 million per year through 2015,
totaling over $2.1 billion in five years.
For policymakers seeking to expand domestic energy production and stimulate economic growth, the public policy choice
is clear. Federal lands energy policy needs to change in order to encourage development of oil and natural gas resources
in a sensible, orderly and balanced way.
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