Washington (Platts)--2Aug2012/105 pm EDT/1705 GMT

US House of Representatives Republicans on Thursday used new federal data showing a spike in US proved oil and natural gas reserves to highlight the difference between production on federal and non-federal lands.

"There is a tale of two energy policies to be told in this country," Representative Fred Upton, Republican-Michigan, said at an Energy and Commerce Committee subcommittee hearing.

Republicans contrasted the oil boom taking place in North Dakota, where most of the new wells are being drilled on state or private lands, with declining production in Alaska where, they argue, restrictive US policies have thwarted attempts to expand production.

A new report from the Energy Information Administration showed that US proven oil and natural gas reserves jumped in 2010 to the largest volumes recorded in more than 30 years. The report was issued late Wednesday.

EIA Administrator Adam Sieminski told the committee Thursday that discoveries and production in tight oil plays in North Dakota, Texas and similar shale areas, led the gains.

"The numbers are big," he said.

Reserves of crude, including lease condensate, increased by 2.9 billion barrels, or 12.8%, in 2010 to 25.2 billion barrels, the report said. Natural gas reserves rose by 33.8 Tcf, or 11.9%, to end 2010 at 317.6 Tcf.

Proven reserves are defined as estimates of hydrocarbons that geologic and engineering data show can be recovered from identifiable fields under existing economic and operating conditions.

The largest increase in crude reserves was due to net revisions of previous estimates, the EIA said. While new discoveries accounted for slightly more than 2 million barrels in 2010, net revisions added 1.9 billion barrels. The revisions were due largely to the "significant increase in oil prices relative to 2009," the EIA report said.

Revisions to proved reserves occur primarily when operators change their estimates of what they will be able to produce using existing technology and prices.

The EIA said that the 2010 report is just being released now because of federal budget restraints. Sieminski also said Thursday that some states can take from two months to as long as two years to completely report production data. He said the EIA has asked for more funding to help improve its data collection efforts.

A great deal oil and gas production is moving from federal onshore lands to lands under state and private control, Michael Nedd, assistant director, minerals and realty management at the Bureau of Land Management testified Thursday.

He said companies make their own economic determinations on whether it is better to drill on federal leases or move to state or private lands. "Most of the large plays are on private and state lands, so industry is going where it is best for them to develop," Nedd said.

--Gary Gentile, gary_gentile@platts.com 
--Edited by Keiron Greenhalgh, keiron_greenhalgh@platts.com

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