believed that thereafter there will be a progressive decline. This may 

 be offset to some extent by non-conventional ("synthetic") oil derived 

 from oil shale and coal. Conventional gas supplies have been forecast 

 to decline up to 1980, then increase until 1990 as new fields are 

 discovered. There will then be a period of continued decline into the 

 twenty first century. Similar to oil, it is anticipated that synthetic 

 gas from coal (along with increased imports, mostly in the form of 

 liquefied natural gas), may take up the slack in domestic output. 



While the projected supply of "conventional" domestic oil and gas 

 is relatively constant, production from existing known reserves will 

 decline; the balance will be made up by new discoveries. It is believed 

 that by 1990, production from existing known oil reserves will amount to 

 only 5 million barrels per day and that production from existing known 

 gas reserves will amount to only 8 trillion cubic feet (Tcf) per year or 

 4 million-barrels-per-day oil-equivalent. It is expected that as much 

 as 40 to 50 percent of the new discoveries will be offshore fields and 

 the total offshore production will rise accordingly. 



1,1.4 Offshore Production and Activity 



While exploration of land areas will be vigorously pursued, the 

 offshore area represents the "last frontier" in U.S. petroleum explora- 

 tion. In the past 15 years the United States has so greatly accelerated 

 offshore oil and gas development that it now accounts for a substantial 

 part of total domestic output. Many trends can be discerned from the 

 data presented in Table 3 which shows the domestic total and offshore 

 oil and gas production from 1960 to 1974, 



Total onshore and offshore oil production increased incre- 

 mentally from 1960 to 1970 but now has declined from that peak period 

 by about 20 percent. 



The significance of offshore oil to the total domestic supply 

 picture is indicated by a comparison of its contribution of 4 percent 

 in 1960 to the more than 18 percent in 1973, Offshore oil production 

 quadrupled during the 1960's, peaked in the early 1970's and then 

 declined about 7 percent. The production of offshore natural gas 

 showed an even more impressive growth. It increased almost sevenfold 

 in the 1960-69 period, reached a maximum in 1971, and since that time 

 has declined by about 30 percent. 



It is generally conceded that offshore production will account for 

 an ever-increasing percentage of total U.S. production; within the next 

 15 to 25 years offshore petroleum may account for as much as 40 to 50 

 percent of all domestic production. In U.S. offshore areas there were 

 1,029 wells and 1,128 wells drilled, respectively, in 1973 and 1974. 

 The number of wells drilled in recent years has remained below 

 1,000. While these statistics indicate that there may be no overall 



