Westerners praised the Salazar oil shale plan released by the Interior Department. “It’s a thoughtful approach to protecting water and local communities from costly oil shale speculation,” said RMFU Director of External Affairs Bill Midcap.
The plan requires that companies conduct successful research operations on oil shale and prove oil shale’s economic viability before the Bureau of Land Management will consider commercial development. Companies will also be required to put proper safeguards in place to protect water supplies, land, wildlife, air quality and local economies.
“Secretary Salazar has brought common sense to oil shale, something we value out here in the West,” Midcap said. “This plan protects our farms and our food.”
The research-first approach has been backed by a wide array of interests including more than 100 business leaders, farmers and ranchers, water experts, and local sportsmen groups as well as local elected leaders, water providers and national sportsmen groups.
In addition to finalizing what lands are available for oil shale research and tar sands, the Interior Department announced draft commercial rules which will also consider a new royalty rate for oil shale. The original 2008 rule had set a royalty rate less than half that of conventional oil and gas development.
Those funds are split between federal and state governments. Local communities typically receive those funds to help offset infrastructure costs associated with energy speculation such as roads, schools, police and fire departments.
Despite more than a century of attempts and billions risked in taxpayer subsidies and private investments, oil companies have failed to create a commercial oil shale industry. Both energy and water demands for processing could be enormous; industry experts have estimated that demand for water could be as much as 140 percent the amount that Denver Water provides to its customers each year.
With the West experiencing a two-year drought, the worst seen in a decade, major new demands for water, such as what oil shale could require, would create enormous pressure on the Colorado River and western drinking water supplies.