Initial oil shale development activities within the United States will most likely occur in Colorado, Utah or Wyoming, because these states contain the thickest and richest oil shale deposits in the nation. Each of these states have large, uninhabited areas where oil shale projects could be constructed, such as the center of the Piceance Creek Basin in Colorado shown below.
While this would appear ideal for this new industry, these same areas may be attractive for recreation and sporting activities or they may be environmentally sensitive for any number of reasons. In order to address all of these concerns, proposed oil shale development projects will need to comply with a large number of permitting requirements, and meet public expectations, before any construction is authorized by federal, state and local government agencies.
An oil shale project cannot be built without receiving the required environmental, construction and operating permits. This is true even if the project is built on private land, although the process and the number and type of permits will be somewhat different on public and private land. Existing Federal and state environmental laws assure that projects comply with strict regulations. Federal environmental laws include: the Clean Air Act; the Clean Water Act; the Safe Drinking Water Act; the National Environmental Policy Act (NEPA); National Historic Preservation Act; and the Resource Conservation and Recovery Act, among others.
Each state has its own rules, regulations and permits. These include the following: ground water discharge permit; dam safety permit; stream alteration permit; water rights permit; drinking water permit; and the permit to mine. On a local level, counties require that projects secure construction permits, which assure the project complies with local ordinances and building codes. The county may require a project to mitigate environmental or socioeconomic impacts as conditions for issuing permits.
Many of the federal, state and local permits require public hearings and allow for a public comment period. This allows the public to voice concerns, which must then be considered by the agencies. The public input may require that the permits contain special stipulations that address issues raised. So, while an oil shale project will necessarily have environmental impacts on a region, the multiple levels of rules and regulations assure that every project must comply with the environmental laws and employ best practices and technologies to minimize or mitigate those impacts.
Studies Misrepresent Future Oil Shale Impacts
National Oil Shale Association
There have been studies released by Colorado entities that misrepresent the potential impacts of future oil shale development. While the path of oil shale development is unclear, the studies referenced below portray large-scale growth scenarios that are based on overstated assumptions, and yet have been used by state officials and others to create misleading perceptions about the impacts from future oil shale development.
1) Northwest Colorado Socioeconomic Analysis and Forecasts, Associated Governments of Northwest Colorado (AGNC), April 2008, prepared by BBC.
This report forecasts two growth scenarios in northwestern Colorado. The base case projects growth associated with the current level of natural gas drilling and development, and the second scenario is the base case plus oil shale development.
In their formal presentation, BBC stated, “oil shale breaks our model”, meaning that there are not enough specifics known about future oil shale development in Colorado to use their model for predictions. So they simply assume that the population growth occurring with oil shale development will be the same as the growth that occurred in the remote area of Fort McMurray, Alberta, Canada as the tar sands were being developed.
There is no basis to assume that the BBC projections would accurately portray the growth patterns that might occur in Colorado, or that oil shale development will require the same levels of employment as tar sands development.
Oil shale will develop incrementally and will have to meet all regulatory requirements as production levels increase over time. There is no assurance today that any significant shale oil production will be achieved, but studies such as this one tend to create public fear and may stymie the current efforts by industry to perfect technologies that can meet regulatory, economic and public expectations.
2) Water on the Rocks – Oil Shale Water Rights in Colorado, Western Resource Advocates, March 2009
Western Resource Advocates (WRA) is a nonprofit environmental law firm. The theme of this report is that the diversion of water to Colorado’s front-range communities is a better use than using western slope water for oil shale development.
In WRA’s inventory of water rights held by energy companies, they overstate the amount of water held by “oil shale interests” by adding in the entire water right holdings of the Colorado River Water Conservation District and the Yellow Jacket Water Conservancy District. The report states that because some part of their holdings could conceivably be used for oil shale purposes, it is justified to add the entire holdings of both Districts to the inventory. In reality, none of these holdings are specifically intended or designated for oil shale development. WRA also includes numerous water rights in their total inventory that they acknowledge have been abandoned.
Because of these faulty assumptions, the report overstates the actual amount of rights held by energy companies by 74% in terms of flow, and by 187% in terms of reservoir storage capacity. This study also over projects water consumption, in barrels of water per barrel of shale oil, by citing the URS Phase I report.
None of these reports assess the anticipated benefits of oil shale development, such as revenue distribution of royalties and taxes, economic development opportunities, and sustainable employment opportunities (including potentially filling the employment gap when gas drilling is completed).
While it is acknowledged that the future levels of shale oil production are not clear, the mischaracterization of oil shale’s potential impacts only serves to unnecessarily heighten public anxiety. Realistically, this enormous domestic energy resource can play a role in reducing our reliance on foreign supplies of petroleum.
Summary of Mischaracterizing Studies 2013 – Printable .pdf