Critics charge energy, water needs of oil shale could harm environment

July 2007

U.S. Water News Online

DENVER -- Environmentalists say mining oil out of shale could require nearly three times the electricity used by the entire state of Colorado in 2005 and consume as much water each year as two cities the size Denver.

That's why they're insisting questions about water and air pollutions be answered before the U.S. Bureau of Land Management moves forward on large-scale commercial oil shale development. Industry officials say it's too early to quantify the potential impacts of a process that is still evolving.

Environmentalists say an oil shale boom could strain area water supplies and increase air pollution if more coal-fired power plants are built to power the mining of oil locked in rock in western Colorado, southwest Wyoming and eastern Utah.

"Our concern is that they're making land management decisions before they've got complete information or without looking seriously at the information they do have," said Bob Randall, an attorney with Boulder-based Western Resource Advocates, an environmental law and policy group.

Randall said the environmental groups' projections on water and energy use are based largely on government estimates and a 2005 report by the Rand Corp. for the U.S. Department of Energy.

"The new power plants needed for oil shale production would exact public health consequences that would seriously undermine any benefit from oil shale projects," said Dr. Brian Moench, president of Utah Physicians for Healthy Environment.

The criticism comes as Rep. Mark Udall, D-Colo., was expected to offer an amendment to the Interior Appropriations bill that would restrict using federal funds in the new budget for final oil-shale regulations or conducting commercial lease sales.

Rep. Chris Cannon, R-Utah, planned to propose an opposing amendment to block attempts to restrict oil shale funding. He noted some estimates place the region's oil shale reserves as high as 2 trillion barrels of recoverable oil.

But the oil, or kerogen, is locked in layers of hard rock, and the technology for affordably heating and extracting the liquid is still being developed.

"With people having to choose between food and putting gas in their cars, it is nothing short of cruel to stand in the way of tapping new sources of fuel," Cannon said.

Several state and local elected officials, though, have urged the federal government to move cautiously. Many of them lived through the oil shale bust of the early 1980s. The final blow came on May 2, 1982, still referred to as "Black Sunday," when oil prices fell and government subsidies dried up, moving Exxon to shut down its $5 billion project in western Colorado.

The industry is taking measured steps. Shell Frontier Oil and Gas Inc. is continuing to refine its process at a private test site in western Colorado, delaying plans to start work on experimental oil-shale operations on federal land.

Shell has invested tens of millions of dollars and more than a decade on a process that heats the oil underground, creates a freeze wall to protect groundwater and pumps the oil to the surface.

Washington-based spokeswoman Heather Feeney said the BLM is preparing a programmatic environmental impact statement on oil shale as directed by the 2005 federal energy bill. The BLM expects to publish the draft document later this summer.

"It was very specific. There is no doubt that is what we're supposed to be doing," Feeney said.

BLM officials have said they're behind schedule. The final review was due in February.

The programmatic analysis, which has a broader scope than a typical review, will thoroughly address issues of water and air quality, Feeney said. More in-depth analyses will be done as specific projects are proposed.

Feeney said any oil shale projects will have to get the necessary state permits.

Shell spokeswoman Jill Davis said she couldn't estimate how much water or energy the company will use in commercial production because the process is still being tested.

"We have acknowledged that the process is currently energy intensive," Davis said. "It is our goal to reduce our power demand and reduce our efficiency."

Based on test results, Davis said Shell believes it can eventually produce three units of energy for every unit required. The company hasn't decided whether to use coal, natural gas or wind for new power plants.

"Protecting air quality is a key objective of Shell's globally," Davis said.

Davis questioned the estimated water use cited by environmentalists from a 2006 report by researchers at the Los Alamos National Laboratory. She said the projection of between one and three barrels of water per barrel of oil produced is a reasonable estimate, but added that it doesn't take into account Shell's plans to recycle water, especially when rinsing the equipment underground.

Chevron USA and Midland, Texas-based EGL Resources Inc. have also landed federal research leases in western Colorado. Oil Shale Exploration Co. has been granted an experimental lease in eastern Utah.

Chevron spokesman Leif Sollid said the company is in the early stage of research and isn't encouraging the establishment of a commercial oil shale leasing program. He said Chevron is working with groups and communities to address environmental concerns.

 

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