The industry has recovered an average of one of every three barrels from domestic reserves in recent years.

"Their domestic reserves and production are declining, and they must cut back on capital spending just when they need it most."

But even as temperatures have risen, so has the demand for oil from the Slope, which holds the country's last big known domestic reserves.

In addition, there are substantial additional domestic reserves of natural gas that can be developed.

A chief aim for Gazprom is to use domestic reserves to build its international profile.

Now, he plans to take advantage of the depressed market by snapping up domestic reserves that bigger companies have put on the auction block.

If we don't find new domestic reserves, we may have to import 70 percent by the year 2000.

He said domestic reserves totaled only 240 metric tons, excluding foreign holdings.

They said the industry incentives were critical to encouraging producers to develop ways to find hard-to-reach domestic reserves, particularly of natural gas.

It is a "drain America first" policy, they argue, using up scarce domestic reserves instead of lower-cost foreign supplies.