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| Oil Shale Pushed as Domestic Oil Source, but Many Doubts Remain |
| 2008-11-09 |
| With the fate of domestic oil production promising to spill over into a new administration, oil companies in northwestern Colorado are steadily pushing ahead with projects to develop the American West's vast deposits of oil shale, estimated to contain the equivalent of more than 800 billion barrels of oil--three times more than Saudi Arabia's proven oil reserves. But they are also among the first to caution against premature exuberance by lawmakers, saying that commercial production, despite some progress, is still years away. Such disparities between political rhetoric and on-the-ground reality are a common theme among national proposals for new sources of energy, but in the case of oil shale, the gap is particularly stark. By most accounts, oil shale's proponents scored two big victories this fall. A congressional ban against oil shale leasing on federal land expired in September while, in the same month, the Interior Department issued guidelines for opening up about 2 million acres in Colorado, Utah, and Wyoming to potential commercial-scale oil shale drilling. If nothing else, the changes are "psychologically important," says Glenn Vawter, executive director of the National Oil Shale Association, because existing restrictions "were sending a message to companies that the government was really skeptical of oil shale or didn't want oil shale." But recent progress on the regulatory front is now colliding with the slow pace of research and testing. Observers say commercial oil shale development probably won't take place until at least the middle of the next decade. ... Meanwhile, falling oil prices this fall are once again raising concerns about oil shale's future, since oil prices in the $70 to $100 range are needed for oil shale to be profitable. Insiders say that big companies aren't too worried by the downward trend, since they expect prices to climb back upward over the next few years. But smaller companies looking to raise capital may find it increasingly hard to attract investment. |
| Posted by:ed |
| #4 Oil shale development is currently stymied by the need for large quantities of water in an area where water is consistently in short supply. At the same time, it's possible to start small and grow, IF alternative methods can be developed that use less water. The best choices right now are domestic oil production, expanded coal production for power generation, and a government program for developing both nuclear power generation and an expanded transmission capability. Oil shale, like solar, wind, geothermal, and virtually every other possible alternative energy supply will require several technological breakthroughs before they can be considered profitable. We can't wait until that happens - we need to establish short-term solutions using existing technologies, and investment in potential long-term replacement processes. Drill here, drill now, build nuke power stations, increase the use of coal, and invest in the continued development of alternative energy capabilities. That's the only way we can get from "here" to "there" without bankrupting the nation and causing far more destruction than progress. |
| Posted by: Old Patriot 2008-11-09 19:12 |
| #3 The US has enough electricity capacity, unless battery powered cars really take off. It's liquid fuels we are not producing enough of. The problem with oil shale and coal2liquids is that they require very large upfront capital investments. That is not possible in a capitalistic economy when the controlling supplier of oil can lower the price until market alternatives are bankrupt. So don't expect a market solution to alternative fuels as long as oil is controlled by monopolistic international oil cartels. It will require gov action to set an oil price floor or subsidy when oil prices crash (conversely a windfall tax to fill a subsidy fund when oil prices are high). |
| Posted by: ed 2008-11-09 17:53 |
| #2 Lots of luck getting investment $ for anything in the next 5-10 years. Putting what investment $ there is into nuclear power would pay off much better IMO. |
| Posted by: Anguper Hupomosing9418 2008-11-09 14:51 |
| #1 IIRC, Shell has a new extraction process for oil shale that produces at $30/barrel. |
| Posted by: SteveS 2008-11-09 10:57 |