NATIONAL OCEANOGRAPHTC PROGRAM LEGISLATION 373 



We believe that the unintended result of some of this legislation 

 would be detrimental to the continued activities of the American petro- 

 leum industry on the Continental Shelf. Of course, we are referring 

 to the vast offshore explorations carried on by the petroleum industry 

 in the offshore exploration, not only in the gulf and Pacific coasts, 

 but in the Great Lakes and Alaska. 



Last year these produced 153 million barrels of oil, worth about 

 $361 million, and I might add this production is on a sharp increase. 

 This activity with its attendant risks has been conducted by private 

 capital and the estimated investment in State and Federal submerged 

 lands is in excess of $3.5 billion. 



In addition, more than $250 million has been spent on pure research 

 of an oceanographic nature such as wave studies, meteorological studies 

 and equipment research and development. 



As a direct consequence, the United States alone in the last decade 

 has received $1.2 billion from lease mineral bonuses on Outer Conti- 

 nental Shelf offerings, $14 million m rentals and an estimated $16 

 million a year in royalties. Sums paid to individual State govern- 

 ments would, of course, be in addition to this figure. For example, 

 the State of Louisiana has received in excess of $700 million from in- 

 dustry offshore operations. 



This oil and gas activity by the petroleum industry is unique 

 in the sense that of man's historic uses of the sea, this is by far the most 

 recent and complex, being measured timewise only in decades and 

 is exceeded by no other industry in terms of the amount of capital 

 required to conduct its operations. 



No other industry would be directly threatened to the degree that 

 is possible under certain provisions of the bills before you. The sec- 

 tions providing for direct Government participation in, or financing 

 of, offshore mineral exploration and development could operate to 

 force withdrawal of private investment from this activity. 



We, therefore, recommend that the specific field of exploration for, 

 and production of, oil, gas and sulfur on the Continental Shelf and 

 other submerged lands to which U.S. jurisdiction might attach, be 

 specifically excluded from the provisions of any bill which this sub- 

 committee may recommend. 



We noted with interest the passage of Senate bill 944 and have 

 quoted in our statement certain segments there which pick up the ponit 

 that we are making, namely, that private investment occupies a unique 

 role in this field. 



We have also attached to this statement, which is being filed for 

 the record with you, suggested modifications of S. 944 to achieve the 

 results we are after. 



Our recommendation is not a plea for permission to operate on the 

 Outer Continental Shelf under other than existing conditions. You 

 are aware that the petroleum industry's activities there are regulated 

 and supervised by a number of Federal agencies. Among these are 

 the Bureau of Land Management, U.S. Geological Survey, U.S. Army 

 Corps of Engineers, Coast Guard, Department of Defense, and Fed- 

 eral Aviation Agency. We would anticipate no basic changes in the 

 roles of these various agencies whose efforts have made possible the 

 accomodation of both petroleum activities and other necessary uses of 

 offshore waters. 



