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Jack N.

Gerard

President & Chief Executive Officer 1220 L Street, NW Washington, DC 20005-4070 USA Telephone (202) 682-8500 Fax (202) 682-8110 Email gerardj@api.org www.api.org

November 14, 2011

The Honorable Harry Reid Senate Majority Leader United States Senate Washington, D.C. 20510 The Honorable John Boehner Speaker of the House U.S. House of Representatives Washington, D.C. 20515 Dear Majority Leader Reid and Speaker Boehner: The U.S. oil and natural gas industry is a vital part of our nations economy. It supports millions of American jobs and delivers billions in annual revenue to our government. Last year, it directly contributed more than $470 billion to the U.S. economy in spending, wages and dividends, and it is one of the few industries that have been creating jobs throughout the recession and ongoing national economic downturn. Our industry can create even more jobs and generate far more revenue if allowed to responsibly develop and produce here in the United States more of the oil and natural gas we need. However, more development especially on public lands and federally controlled waters requires that industry and government share a vision of the potential benefits and act as partners to fully realize them. We believe the U.S. Department of the Interiors recent proposal for developing our offshore oil and natural gas over the period 2012-2017 acknowledges only a small fraction of that potential. It imposes unnecessary limits on what we could and should be doing to secure more domestic energy for our future. Potentially very large oil and natural gas resources in the Atlantic, Pacific and Eastern Gulf of Mexico were left out of the departments plan. Comments from the department suggest this was at least in part because accurate, updated estimates of the resource potential in those areas are not available. That argument, however, presents a Catch-22. Information on the resource potential in these areas is old and incomplete. Yet without the possibility of a lease sale, companies will not invest in the costly exploratory work needed to get more accurate and comprehensive data. News reports cite Department of Interior claims that more oil and natural gas are being produced, suggesting current government energy policies are working. While oil and natural gas production is

increasing, this is largely due to the development of shale oil and natural gas on private lands in North Dakota, Pennsylvania, Texas, Arkansas, Louisiana and elsewhere and because of leasing and development on public lands and federal waters initiated many years ago. To ensure we are able to meet tomorrows energy needs, we must be making positive energy decisions today that support robust and expanded leasing of both offshore areas and BLM-administered lands. Expanded development of offshore areas would be pursued under the same improved rules, procedures and technologies that have raised the bar on safety in the Gulf of Mexico. Interiors new offshore plan is a missed opportunity. We urge you to support legislation that would open more of the nations offshore areas to development, putting more energy in the pipeline for tomorrows consumers while creating thousands of additional good-paying jobs, generating billions of dollars in additional revenue, and strengthening Americas energy security. Sincerely,

Jack N. Gerard President & CEO cc: Members, Senate Natural Resources Committee Members, House Natural Resources Committee

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