Oil independents seek help to boost U.S. output

HOUSTON, May 3 (Reuters) - Small U.S. oil and gas producers urged the government on Monday to take steps to boost domestic production to reduce dependence on imported hydrocarbons.

The Independent Petroleum Association of America urged Washington to open up more areas for exploration and provide royalty relief to producers at times of low oil and gas prices.

Bob Boswell, chairman of the IPAA's offshore committee, said the United States currently imported about 54 percent of its oil and 14 percent of its gas but added that domestic reserves of both commodities were underdeveloped.

According to U.S. government estimates, undeveloped domestic oil resources are twice as big as developed resources while undeveloped domestic gas resources are three times as big as developed resources, he said.

Boswell, who is also president of Forest Oil, was speaking to reporters at the Offshore Technology Conference in Houston.

``Less than five percent of total offshore acreage is available for leasing (and) several promising areas are subject to a moratorium,'' he said.

Boswell called on the federal government to open more acreage to exploration and to lighten the regulatory burden on oil and gas producers.

He also urged the government to introduce a sliding scale which would cut royalty rates on oil and gas production when prices came under pressure.

The IPAA recommends cutting royalty rates to 75 percent of normal levels when oil prices fell to $12-18 a barrel or gas prices fell to $2.00-2.50 per thousand cubic feet.

Royalties would fall to 50 percent of normal levels for oil prices $10-12 and gas prices of $1.50-$2.00.

Another IPAA representative, Joseph Blandford, contrasted the willingness of Congress to support the beleaguered steel industry with the lack of support for the oil industry.

Blandford, president of Atlantia Offshore, said the steel industry had lost about 10,000 jobs while the oil and gas sector had lost about 50,000 over the last year.