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BLM Announces First Cut on Oil Shale RD&D Proposals

Location of the Green River formation and main basins. Click to enlarge.

The Bureau of Land Management (BLM) announced that eight proposals for oil-shale research development and demonstration (RD&D) leases filed by six companies have been deemed eligible for continued consideration.

The eight proposals were among 20 nominations the BLM received in response to a call for proposals for 160-acre RD&D leases on public lands in Colorado, Utah, and Wyoming. Those nominations were evaluated by an interdisciplinary team of representatives from the BLM, the Departments of Energy and Defense, and the governments of the three States.

The companies that filed the eight applications are:

  • Chevron Shale Oil Company;
  • EGL Resources, Inc.;
  • Exxon Mobil Corporation;
  • Oil-Tech, Inc.;
  • Oil Shale Exploration, LLC;
  • Shell Frontier Oil & Gas, with three separate applications.

The next step in the evaluation process will be to complete an environmental analysis under the National Environmental Policy Act (NEPA) of the eight proposals.

Each of these proposals shows potential for advancing knowledge of oil shale recovery technology, evidence of economic viability, and adequate means for managing the environmental impact of oil shale development.

—BLM Director Kathleen Clarke

The parcels nominated by Chevron, EGL, Exxon Mobil, and Shell are located on public lands in Colorado. The proposals submitted by Oil-Tech and Oil Shale Exploration, LLC involve parcels in Utah. Each nomination identifies the 160 acres allowed in the call for RD&D proposals, along with an additional contiguous area of 4,960 acres to be reserved for a preferential right to convert to a commercial lease at a future time after additional BLM review.

Six of the proposals involve in-situ retorting, which does not permanently alter the land surface as does the mining method. All current methods for processing oil shale require heating the rock to mimic the geologic processes that produced conventional deposits of oil and natural gas. NEPA analysis will help the BLM determine whether current technologies will result in less surface disturbance than earlier methods.

The United States holds significant oil shale resources underlying a total area of 16,000 square miles. This represents the largest known concentration of oil shale in the world. More than 70% of American oil shale is on Federal land, primarily in Colorado, Utah, and Wyoming.

A report from RAND in 2005 derived an upper bound of 1.1 trillion barrels of oil recoverable from oil shale, and a lower bound of about 500 billion barrels. The analysts opted for a midpoint—800 billion barrels—in assessing the potentially recoverable oil.

The analysts estimate that under high growth assumptions, an oil shale production level of 1 million barrels per day is probably more than 20 years in the future, and 3 million barrels per day is probably more than 30 years into the future.

The RAND report, Oil Shale Development in the United States, also notes:

Developing a quantitative estimate of these benefits [of oil shale production] is difficult, requiring assumptions far into the future regarding OPEC production and pricing behavior, the demand and price for crude oil, the costs of producing shale oil, and the nature of investments that would be taken in the absence of a domestic oil shale option.

If low-cost shale oil production methods can be realized, direct economic profits in the $20 billion per year range are possible for an oil shale industry producing 3 million barrels per day...While it is difficult to predict the employment gain, it is possible to estimate that a few hundred thousand jobs will be associated, directly and indirectly, with a 3 million barrel per day industry. The net effect on nationwide employment is uncertain, however...

In deciding to provide access to federally owned lands bearing oil shale, these are the benefits that will eventually accrue from full-scale development and which offset costs associated with land use and adverse environmental impacts that cannot be mitigated.

It is relevant to note that a portion of the benefits—namely, those economic and national security benefits associated with lower oil prices—would occur whether the additional production occurs within the United States or in some other country that is not a member of or colluding with OPEC.

The BLM has also initiated a programmatic Environmental Impact Statement (PEIS) to support development of commercial oil shale and tar sands leasing on public lands, as the Energy Policy Act of 2005 requires. (Earlier post.)



tom deplume

I wonder if the environmental impact of all that fossil carbon released into the atmosphere is included in the study.


Forget it. The oil can't possibly be worth it, especially that far in the future. A california study concludes that an electric vehicle even with coal fired plants has a lower carbon impact than any of the alternatives. We need to transition away from oil, especially oil from shale.


At $60+ a bbl, it's definately profitable. If it wasn't you wouldn't see this type of interest in it. Transitioning from oil is a must, eventually, but it isn't going to happen overnight. It isn't going to happen in a decade. We need these types of projects to provide a buffer against OPEC and other non stable countries. Now if we could just get the coasts and ANWR opened...


I think the coasts and the North Slope would be preferable to this. The Rand people estimate it will take 3 barrels of water to produce 1 barrel of oil. ("Water consumption in producing oil shale is about 3 barrels per barrel of oil. Earlier analyses of water availability for oil shale need to be updated based on current and expected demands for water from the Colorado River Basin.") Hmm, analyses of water availability need to be updated, well put. The cities that depend on the Colorado River for their water have seen much growth in the past couple of decades, and it shows no sign of stopping. The water issue may turn out to be one of the thorniest to deal with.


In situ methods use alot less water and as with oil sands methods they have found many wayers to reuse much of the water they do use since the last time studies were done.

The WORKING oil sands projects in canada consumer far less water then before because they recyc 75% of it AND have developed better extraction methods on top of that.

So take all those old numbers and toss em out. This is research to find out how we can do it NOW no how we could do it 40 years ago.

Harvey D

Before giving to much praise to shale and tar sand extraction, I highly recommend reading an recent (Nov. 05) report (Oils Sands Fever) by Dr. Marlo Raynolds (Pembina Institute)and Dan Woynillowich, et al on Alberta Tar extraction numerous impacts. Full report available free from:
We seem to be heading for an environmental mess from strip mining and in situ extraction activities.

tim "zynski"

Thank you Obama,,, your gonna make me rich working in the natural gas and now shale oil industry,, at least for a while,,10 - 15 years?...i woulden't bet on it for longer than that,, cause it's gonna stay in the ground,,,
It would scare the crap out of me if palosi discovered gen IV nuclear reactors,, that create electricity and high heat,,, coupled with high temp ceramics to create hydrogen,,, not to mention electricity from heat from razor company in utah,, to squeeze every last bit from the process,,, and if palosi or joe kennedy discover it,, just yell "3 mile island" ,, and i'll don my protective leisure suit.. and sip some boones farm,,, and count my money till they get their head out of their arses,,,,,, check out or and put my fat oily arse out of business

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