California is dependent on oil and gas for 98% of its total energy needs. Petroleum is the state's number one mineral commodity, with an annual value of $1.2 billion. Industry's payroll is $1.3 billion, and its tax bill to state and local government is $274 million.

Statewide regulation of the industry, which started in 1915, was directed primarily toward preventing waste and damage. Numerous governmental agencies are now engaged in regulation directed at protection of the environment; at the federal level there are five agencies, at the state level, six. The petroleum resource must be utilized, but at the same time extraction and refining must have minimal effect on the environment.

The "oil patch" philosophy is out of date. Most industry people do not think sumps, derricks, or piles of tubing are ugly, but many other people do. It can be shown that a spill in the ocean has no lasting effect on the biota, but it is a disaster to the person that gets oil on his feet. Industry has done a remarkable job in responding to the new environmental philosophy by starting programs to clean up sumps, beautify drill sites, and install pollution-prevention devices. To clean up the "oil patch" is not just good public relations; it is a necessity in order to stay in business.

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