Via memeorandum I see that Ken Salazar (D-CO) has a cautionary editorial in today’s Washington Post about oil shale. In it, he reminds people that although technological progress has been made, companies are still a long way from solving the problems involved in extracting oil from those vast deposits, and he wonders what the purpose is in what he calls the BLM “fire sale”:
This sale would be a tragic case of putting the cart before the horse. How is a federal agency to establish regulations, lease land and then manage oil shale development without knowing whether the technology is commercially viable, how much water the technology would need (no small question in the arid West), how much carbon would be emitted, the source of the electricity to power the projects, or what the effects would be on Western landscapes?
While the question of commercial viability doesn’t really belong there, he has a couple of very good points — not least being that R&D is ongoing even now, and the currently-leased land is serving that purpose very well. Unless the companies who are working on the challenge have said they need a different lease for their research (and I haven’t read that they have), I have to agree with him here. Madly auctioning leases when there are still many technologies being explored seems pretty silly — just another example of a confused and reactive government trying to look as if they’re doing something.
The potential, though, is pretty incredible. If energy companies can solve the technology challenges (and it truly is an “if”), then oil shale should be part of the overall US energy plan.
Sunday’s Houston Chronicle had the best description I’ve yet read about the deposits themselves, development and extraction history, and the very real technical challenges involved in doing anything with it.
If the oil industry can learn how to extract oil and gas from the oil shale in a cost-effective manner, the United States could lay claim to oil reserves totaling, perhaps, 800 billion barrels — three times Saudi Arabia’s.
Wow. But look — here’s the Democrats, locking the gates again.
President Bush last month linked oil shale with his oft-repeated calls to open Alaska’s Arctic National Wildlife Refuge and more areas offshore to oil and gas drilling, hailing the “extraordinary potential of oil shale.”
But Democrats have barred the Bureau of Land Management from leasing any federal land for commercial-scale oil shale projects.
Or are they?
In 2005, the Bureau of Land Management launched a program to spur interest in the oil shale, handing out six leases for research and development projects on federal lands, where most of the oil shale is located.
Shell, by nearly all accounts the industry leader in oil shale research, landed three of the leases. The subsequent ban on commercial shale leases doesn’t prohibit research activities.
Doesn’t look like the Democrats are holding anything up, frankly. And neither are the oil companies.
Competitors are pursuing different approaches. Chevron, working with experts at the Los Alamos National Laboratory and the University of Utah, hopes to avoid the need for so much power by extracting oil and gas through a chemical process. Exxon Mobil is investigating using an electric current to heat the shale, and Schlumberger — with technology developed by Raytheon Co. — is examining using radio waves to heat the rock.
Oil Shale Exploration Co. could beat all these players to the punch. It’s considering returning to the mining and retorting method to develop oil shale. The privately held, Utah-based firm announced last month that Brazil’s oil company, Petrobras, and Japan’s Mitsui & Co. had purchased minority stakes in the venture.
“Whoever cracks the nut is going to be sitting high,” said Carroll Campbell, a retired Shell operations supervisor.
It just ain’t soup yet, folks.
The point of all this is that oil shale, for all its potential, is not going to solve our energy needs today. Don’t let the election-year hype fool ya.