Capital Spending for U.S. Projects

Significant oil and gas discoveries that are announced
today often result from investments begun by companies
as far back as a decade or more ago. Since the year
2000, our industry invested over $3 trillion dollars
in U.S. capital projects to meet the growing demand
for oil and natural gas. The worldwide economic
downturn, along with lower oil and natural gas prices
and tight credit markets, caused some oil and natural
gas producers to cut their capital budget plans in 2009. The Oil & Gas Journal estimates capital spending on U.S. projects will decline again in 2015 as the value of oil has fallen almost in half over the past year leaving many companies with less to invest.

Planning and investment cannot be turned on and
off like a spigot, without entailing huge, potentially
non-recoverable costs and delaying urgently needed
projects. Because the industry must plan and operate
under these long lead times, it is hypersensitive to
minimizing risk over the course of its investments. It is
crucial for an industry that must manage such huge
risks that government provide an energy policy and tax
framework that encourages investment, rather than
discourages it.