INTRODUCTION The petroleum industry's continuing concern for protection and improvement of the environment is demonstrated by the number and variety of the projects described in this report. In addition to summarizing the results of completed projects that were released during the past year@ the report also describes the objectives and status of new and continuing projects. It does not duplicate the abstracts of completed projects that were contained in a previous edition (API Publication 4107@ January 1972). Nor does it repeat the history of API's organized conservation efforts ?C going back almost half a century ?C which were described in the 1972 report. This report focuses primarily upon those projects which are sponsored by the Committee on Environmental Affairs (formerly the Committee for Air and Water Conservation)@ since these constitute the principal mechanism through which API funds are made available for the study of environmental problems by universities@ medical schools@ foundations@ government agencies@ and independent research laboratories. The inter-disciplinary aspects of these research activities may not be readily apparent to the readers of this report. The fact is@ however@ that industry representatives with expertise in biology@ chemistry@ engineering@ law@ marketing@ medicine@ production@ refining@ safety@ transportation@ and wildlife conservation frequently serve together on environmental research task forces. Approximately $2-65 million in new funds has been approved for API's 1973 environmental research budget. These funds@ together with some $2@25 million previously appropriated and committed largely to projects that will be completed in 1973@ bring the total funds available for environmental research this year to $4@9 million. This by no means reflects the petroleum industry's total expenditure for environmental protection in the United States which@ on the basis of a recent survey@ is estimated to average some $3.3 million each day. A substantial portion of API's environmental research budget goes to support the activities of the Air Pollution Research Advisory Committee (APRAC) of the Coordinating Research Council (CRC). This multi-million dollar research program@ now in its sixth year@ concentrates on automotive air pollution and is supported jointly by API@ the Motor Vehicle Manufacturers Association of the United States@ and the U@ S@ Environmental Protection Agency (EPA). Additional information on any of the research projects described in this report can be obtained from the Committee on Environmental Affairs@ American Petroleum Institute@ 1801 K Street@ N. W.@ Washington@ D. C. 20006.