DENVER -- The Rocky Mountains' natural amenities are more important to the regional economy than the booming oil and gas industry, according to a new report compiled by an environmental group and supported by some regional economists.

The report released by The Wilderness Society Thursday says the oil and gas industry accounts for less than 2 percent of the region's total personal income. Parts of the economy dependent on the quality of natural surroundings -- recreation, tourism, influx of retirees -- have become more important, it says.

"The Marlboro cowboy economy is a consistent myth," Walter Hecox, an economics professor at Colorado College in Colorado Springs, said in a teleconference.

Income from investments and retirees makes up nearly a quarter of the region's economy, according to the report "Natural Dividends: Wildland Protection and the Changing Economy of the Rocky Mountain West."

Recreation and tourism generate hundreds of millions of dollars, it says.

The report covered Colorado, Idaho, Montana, New Mexico, Utah and Wyoming.

The report says the pace of natural gas development should be slowed with production phased in rather than scattered over wide areas to ensure that landscapes, air and water quality aren't damaged.

An energy industry spokesman said oil and gas are helping Western states diversify their economies, and the industry can be compatible with the types of economic activity identified in the report.

While it's difficult to put a price tag on nature's value, research shows that people will pay more to live near forests and settle for lower wages to be near natural amenities, said Jennifer Thacher, an economics professor at the University of New Mexico.

Dave Knutson of Chaco Footwear said the company's location in Paonia in western Colorado has been a draw for several professionals because it's close to wilderness areas, rivers and national parks.

The report comes amid an energy boom felt across much of the West. Driven by high prices and a push for more domestic energy, natural gas production has hit record rates in parts of the Rockies.

The oil and gas industry employed 26,600 people in Wyoming last year and paid about $711 million in severance taxes and $767.5 million in property taxes, according to the Denver-based Independent Petroleum Association of Mountain States.

Colorado's oil and gas industry contributed nearly $23 billion in direct and indirect economic benefits to the state in 2005, according to a study released in June by the Colorado Energy Research Institute, created by the Legislature.

"Oil and gas production is helping to diversify the economy and allowing a lot of folks from rural communities to stay in those communities and make a living," said Marc Smith, executive director of the petroleum association.

Energy development can be compatible with tourism, recreation or the other industries in The Wilderness Society's report, Smith said. Only about 1 percent of federal land has oil and gas development on it, he said.

The problem, said Steve Smith, The Wilderness Society's deputy regional director, is that the federal land being developed is distributed widely across the landscape and brings roads, pipelines and other facilities that break up wildlife habitat and affect waterways through runoff and air quality through dust and emissions.

Pete Morton, an economist and one of the report's authors, said energy companies have leased 31 million acres of public land in the Rockies.

The environmentalists and economists acknowledged that the energy industry has created high-paying jobs and that business in communities in the midst of the boom "is going gangbusters." They questioned, though, how long the economic pace can continue given escalating house prices and the intense competition for employees.

Town officials in Pinedale have voiced concern that fast-paced, widespread gas drilling could perpetuate a boom and bust, hindering their ability to sustain the economy after energy development wanes.

Hecox of Colorado College said he believes new laws in Colorado to expand regulation of oil and gas beyond the traditional agencies are a reaction to the industry's growth.

"I think society in general is saying we have a role to provide energy, but this is too much too fast," Hecox said.