The oil and gas industry will have to deal with two major environmental issues in the next decade-the prospect of policies to combat climate change ("global warming") and restricted access to oil and gas reserves. These issues have the potential to affect companies\' sales, operating costs, asset values, and shareholder value.

The companies covered are: Amerada Hess (AHC), Apache (APA), BP (BP), Burlington Resources (BR), ChevronTexaco (CVX), ConocoPhillips (COP), Eni (E), Enterprise Oil, (ETP), ExxonMobil (XOM), Occidental Petroleum (OXY), Repsol YPF (REP), Royal Dutch/Shell Group (RD), Sunoco (SUN), TotalFinaElf (TOT), Unocal (UCL), and Valero Energy (VLO).

International concern is growing that rising greenhouse gas (GHG) emissions, derived mainly from combustion of fossil fuels, is causing the Earth\'s climate to change. Over one hundred eighty countries have joined together in drafting the Kyoto Protocol to limit GHG emissions. It commits developed countries to reduce GHG emissions to 5.2 percent below 1990 levels by 2010. The Kyoto Protocol will likely go into force, but probably without the participation of the United States and possibly Australia. Even without these countries, the Protocol could have significant impacts on market demand and producer prices for crude oil, natural gas and petroleum products.

The industry also faces growing constraints in accessing oil and gas reserves, as increased efforts are made to protect pristine areas and preserve ecosystems. Community opposition puts production in a number of countries at growing risk, especially where population growth increases competition for land.