Monday, September 22, 2008

Ritter Calls for Caution on Oil Shale Program

Gov. Bill Ritter asked the Bush Administration to slow down its commercial oil shale leasing program today, criticizing the federal government's ongoing efforts as being insufficiently protective of Colorado's environment.

In a letter to the director of the Bureau of Land Management, Ritter argued that issuance of permits that would allow companies to begin extraction activities is premature.

"I am concerned that the Department of the Interior is proceeding in this Administration’s waning days with premature regulations that would establish a commercial leasing program for oil shale, despite the fact that neither the Department nor the industry has a clear understanding of which oil shale technologies will prove viable and what the associated costs and impacts will be," Ritter wrote. "Until these and other vitally important questions are answered, it is impossible to develop regulations that contain appropriate protections for the environment, appropriate royalty rates to ensure a fair return to the state and federal treasuries, and a financial safety net for communities."

The governor did say that he is not against oil shale development, but made the case that too little is known about how to obtain and use the resource in an economically viable and environmentally sensitive manner.

Northwest Colorado is home to extraordinary oil shale resources, among the richest in the world, yielding 25 gallons of oil or more per ton of rock. The area is estimated to hold nearly 500 billion barrels of proven oil shale reserves, more than double the proven reserves of Saudi Arabia. Successful development of this resource could provide a substantial new source of domestic oil for the United States, which would have positive implications for our national energy policy and national security.

However, I believe strongly that the state and federal government must be thorough and thoughtful in our approach to oil shale, especially in light of the magnitude of such development. If the Department of the Interior were to authorize a commercial oil shale industry in Colorado, the development would constitute the largest industrial development in the State’s history -- with enormous implications for all of Northwest Colorado and for the State itself.

Though remarkable, Colorado’s oil shale resources have remained in the ground since their discovery over a hundred years ago. Past development attempts have failed due to a number of challenges -- technical, economic, and environmental -- that have yet to be overcome, notwithstanding billions of dollars invested by both government and industry.

Ritter asked BLM to refrain from issuing any final regulations until Colorado's concerns are adequately addressed.