Exxon oil shale lease moves forward; critics point to past bust

Gov. Bill Ritter today said he was pleased by the “thoughtful approach” being taken by U.S. Bureau of Land Management as it moves forward with its next phase of research and development leases for the oil shale industry in Colorado and Utah.

BLM director Bob Abbey today announced the federal agency has reviewed nominations for three potential lease-holders — ExxonMobil and Natural Soda in Colorado and AuraSource in Utah – and will now forward them on to state regulatory agencies for the next phase of consideration.

“The potential for oil shale development in Colorado, and the economic opportunity that it represents, is huge,” Ritter said in a release. “But the prospect of commercial-scale activities raises significant questions about how oil shale can be successfully integrated into our state’s economy and how we can protect the state’s environment, water, wildlife and communities.”

Exxon ramped up for a major oil shale development boom on Colorado’s Western Slope in the late 1970s and early 80s but ultimately pulled out, leaving towns like Battlement Mesa and Parachute overnight ghost towns.

After six R&D leases were issued in 2007 under the Bush administration, U.S. Secretary of the Interior and former Colorado Sen. Ken Salazar in 2009 questioned the Bush-era leasing program and set significant limitations on the size and length of the next round of R&D leases.

Critics say the process is far too unproven, requiring enormous amounts of coal-generated electricity and water – and that it would devastate the fragile landscapes of the West.

“People have been trying to figure out how to suck the hydrocarbons out of these rocks for over a century,” former oil shale worker Craig Thompson said in a release. Thompson is now a professor of engineering at Western Wyoming Community College and on the board of the National Wildlife Federation.

“No one has found an economic solution. When Exxon pulled the plug on their $5 billion gamble and laid off 2,200 workers, the West learned a bitter lesson. The last thing we need is another pipe dream and another economic ‘bust.’”

An Exxon spokesman did not immediately return a call requesting comment.