Potentially, shale oil is a fabulous fuel. It requires no costly hit-or-miss exploration, no ocean rigs, no precarious negotiations with foreign governments. Instead, it is a U.S. resource, locked in immense quantities—estimates range from 600 billion to 3 trillion bbl. — in rock formations throughout the semi-arid Rocky Mountain states. But no major shale-oil development could begin until the Federal Government, which owns between 70% and 80% of the oil-bearing lands, decided to lease out its deposits. That decision, in turn, depended mostly on how serious the environmental effects of mining would be.
Last week, after studying the situation for more than three years, the Interior Department announced that it would launch an experimental program to tap federal shale-oil reserves. “It is in the national interest” to go ahead, said Interior Secretary Rogers C.B. Morton, adding: “We have developed rigorous and comprehensive environmental controls. The potential benefits outweigh the unavoidable costs and risks involved.”
Those benefits start, of course, with the fact that the U.S. needs the oil. Economical methods have been developed to get it (estimated cost per bbl.: around $6, or about as much as that of newly found U.S. oil). In each of these, the shale is literally chewed up and cooked. Under heat, the kerogen in the rock yields a heavy oil similar to petroleum crude. As an environmental plus, shale oil contains very little sulfur. At first glance, Interior’s program might appear to be too tentative and cautious for an energy-starved nation. Of the Federal Government’s 8 million acres of oil-shale land, only six tracts will be leased for exploitation: two each in Utah, Wyoming and Colorado. Each tract will comprise only 5,120 acres. But the two richest parcels—those in Colorado —contain nearly as much potential oil (some 9 billion bbl.) as that located by the great strike on Alaska’s North Slope.
Each winning bidder in auctions beginning in January will have to invest $200 million to $250 million just to get the oil out of the rock. Return on that investment will be slow, because construction of mines and refineries will take about five years. The first plants are expected to produce 250,000 bbl. of shale oil a day. That is only 1% of the nation’s daily demand for oil—”a teacup,” says one oilman. The justification is that if all goes well, the shale-oil industry could be expanded to provide 1 million bbl. a day by 1985, and eventually perhaps 100% of the U.S.’s needs.
Nuclear Mining. Since the program is experimental, the Interior Department expects that different extraction techniques will be used in different locations. At the two tracts in Wyoming, for example, the oil will most likely be boiled out of the rock in situ—underground. Occidental Petroleum Co., one of the many U.S. oil companies that lease private oil-shale lands, has developed such a process. Occidental’s technique is to blast a chamber inside the oil-bearing rock, inject natural gas into it and then set it afire. The subterranean conflagration would cause the rock to yield its oil, which would then be brought to the surface via special wells. The cost is estimated at slightly more than $1 per bbl. To get the same result another way, Arthur Lewis of the University of California Lawrence Laboratory suggests that the necessary heat come from atomic bombs, which would be exploded in deep layers of rock.
Open-pit mining methods, like those used to get copper in Butte, Mont., may also be tested, probably at one of the Colorado tracts. Great earth-moving machines would first peel back the sagebrush and grass over thousands of acres, next remove billions of tons of earth and rock, and finally gouge out the oil-shale beds 100 ft. to 850 ft. below the surface. The other technique, to be tried at the remaining leaseholds, will be to deep-mine with conventional pillar-and-room tunneling, as is done with coal—but on a gargantuan scale. More than 70,000 tons of oil shale might be moved daily from mine to processing plant. There, the shale would be crushed and heated to about 950° F. in retorts. The extracted oil would then be refined.
Environmentalists are aghast at the project. Their biggest fear concerns waste shale. Almost incredibly, once the oil has been removed, what remains is pulverized rock with at least a 12% greater volume than it had before it was mined. Reason: there are spaces between the rock particles that did not exist when the rock was in the ground. What can be done with this spent shale? Colony Development Operation, a consortium of companies including Atlantic Richfield and Standard Oil of Ohio, has spent $1,000,000 on detailed environmental studies of the problem. Conclusion: the powdered shale can be dumped into canyons, watered, fertilized and planted with vegetation to prevent winds from blowing it into dust storms. All this can be done, says Colony, with minimal harm to the delicate ecology of the semi-arid region. Environmentalists wonder whether all companies would be so careful. If they were not, occasional rains would leach residual salts out of the wastes, sweep them into streams, and thus contaminate the area’s precious water supplies.
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