the u.s. shale oil boom, page-72

Feds to Review Oil Shale Rules Challenged By
Environmentalists


February 16th, 2011





U.S. Interior Secretary Ken Salazar said Tuesday that federal officials will take a fresh look at the 2008 rules on commercial-scale development of oil shale in Colorado, Utah and Wyoming, put forward by the Bush Administration during its last days in office.
Posted by Ann Rascalli


Salazar said the review will settles two lawsuits filed by environmental groups in 2009 over the federal governments rules for commercial-scale oil shale operations.

The oil shale rules were put forward in the last days of the Bush Administration, and changed oil-shale plans by the Bureau of Land Management in Colorado, Utah and Wyoming.

Nevertheless, no commercial leases have been issued by the BLM since the 2008 rules were implemented, no doubt more a result of the difficulties associated with making the production of shale oil commercially viable. In addition, a spokesperson for the BLM said the pending review will not change rules governing existing or proposed leases for oil shale research.

The changes opened nearly 2 million acres of federal land to the possibility of commercial-scale development of oil shale and tar sands. They also set a royalty rate, paid to the government as the land owner, at five percent for the first five years of commercial production. The rate would rise 1 percent a year until it hit a cap of 12.5 percent.

Opponents point to oil shales lack of technical advancement, and say the Bush rules opened land to commercial production before the technologies had been perfected or reviewed. They also challenge the royalty rate which they label as too low.

Earthjustice filed two federal lawsuits against the oil shale rules the same month President Obama was inaugurated in 2009. They did so on behalf of 13 environmental groups, including the Rocky Mountain regional office of the National Wildlife Federation.

The agreement to review the 2008 rules in coming months was accepted by Kate Zimmerman, an attorney with the Federation said the agreement to review the 2008 rules in coming months was accepted.

Specifically, the review will look at the amount of water available for use in oil shale operations; potential impacts on federal lands, wildlife and watersheds, and the amount of royalties that oil shale production should pay, Salazar said.

The U.S. Geological Survey, another Interior agency, also will analyze the amount and quality of water available to better understand the groundwater and surface water systems that might be affected by commercial-scale oil shale operations, according to the Secretary.

Oil shale is an important resource for the U.S., said Salazar, a former U.S. senator from Colorado. We need to move forward and examine the possibility of developing oil shale as part of our national portfolio, but we need to do it in a smart way.

The BLM said its six existing federal leases for oil shale research and development projects, including three leases on federal land in Colorado, wont be changed by the rules review governing commercial leases. Three proposals for leasing additional federal land for oil shale research, including two proposals in Colorado, also wont be affected by the review, according to the BLM.

We support Secretary Salazars announcement, Zimmerman, the National Wildlife Federation attorney, said. Oil is perhaps a scarce resource, but water is a scare resource here in the arid West.

The review was welcomed by U.S. Sen. Michael Bennet, D-Colo., who issued a statement in which he called it a welcome step forward in our efforts to ensure thoughtful, responsible development of Colorados natural resources while protecting the land, water and way of life we in the West hold dear.

While we should allow for research and development to proceed, we must also be mindful of the need to protect our land and water and provide a fair return to American taxpayers, Bennet said.