ConocoPhillips

Congress and the administration are debating measures that, if approved, could have dire economic consequences—killing jobs, driving small-and mid-sized firms out of business and shutting down our ability to safely and reliably produce our domestic energy resources. With 15 million people out of work, now is not the time for energy legislation that could hurt the American economy.

Congressional proposals to repeal or modify several long-standing, legitimate tax policies related to the U.S. oil and natural gas industry would further weaken the economy, destroy jobs and undermine future energy security.

The oil and natural gas industry supports more than 9 million American jobs and 7.5 percent to the nation’s gross domestic product.

Claims that the industry does not pay its "fair share" of taxes are patently false: in 2009, the oil and natural gas industry had an effective tax rate of 48.4 percent, compared to 28.1 percent for other industries.

Repealing tax provisions that were enacted to create U.S. jobs and keep them here, such as the domestic jobs manufacturing deduction, would make U.S. companies less competitive abroad and reduce the number of jobs in the United States.

• More energy means more jobs, higher incomes and economic growth.
• Until Washington acknowledges the critical link between energy and the U.S. economy, we will not have the energy or economic growth that our country needs.
• According to the government’s own estimates, increased domestic oil and natural gas development will be necessary to meet our nation’s increasing energy demands now and over the next several decades.　
• Offshore safety and environmental protections must and will be improved. But, at the same time, any legislative and regulatory proposals must protect the American people and advance our nation’s energy and economic interests.
• Proposals that would reduce or delay deepwater development could result in:

• The loss of as many as 175,000 direct, indirect and induced jobs a year associated with deepwater development through 2035;
• Additional job losses if shallow water drilling projects are affected;
• A reduction of annual gross domestic product by more than $20 billion per year or a cumulative impact of approximately $500 billion in the next 25 years;
• A reduction in long-term U.S. oil production by 27 percent; and
• An increase in long-term U.S. foreign oil imports by 19 percent.

About 30 percent of the nation’s total domestic oil production and 13 percent of domestic natural gas is produced in the Gulf of Mexico, where a majority of the nation’s offshore development takes place.

Of that, approximately 80 percent of the oil and 45 percent of the natural gas in the Gulf come from deepwater exploration.

It is unnecessary and shortsighted to shut down a major part of the nation’s energy lifeline while we work to enhance offshore safety.

A moratorium threatens enormous harm to the nation and to the Gulf region, putting 46,200 jobs and 4 percent of deepwater production at risk, and wiping out up to $500 million in potential government revenue in 2011 alone.

This issue is much larger than the oil industry—access to affordable energy impacts every sector of our economy, every state in our nation and every American family.

The moratorium is essentially a moratorium on economic development.

The Gulf of Mexico region is already struggling from devastating losses from Hurricanes Katrina and Gustav while struggling with the depressed national economy. Stifling one of the area’s primary economic engines would cripple the local economy and result in long-term consequences.

A study by Dr. Joseph R. Mason of Louisiana State University demonstrated that, in addition to job loss, the moratorium will also affect local tax revenues; with Texas estimated to decrease by $22.8 million.