Thirty years ago, Herb Bacon was working in the old U.S. Bank of Grand Junction when a man operating Exxon’s local oil shale project walked into the lobby with his usual pep in his step.
“He stopped in almost every week and when he came in one particular Friday, I asked him how things were going and he said they’d never been better,” Bacon, 82, recalled last night. “He was expecting a group from Japan to take a tour that weekend. The following Sunday I was out in front of my house trimming the hedge — I had attended church earlier that morning — when my wife came out and said, ‘You won’t believe what I just heard on the news: Exxon is shutting down its operation here.’”
That day on May 2, 1982, became known as “Black Sunday,” when Exxon laid off 2,200 oil shale workers on Colorado’s Western Slope. The Colony Project, as it was called, had such a profound impact on the region that when Exxon walked away, small businesses in the area quickly mothballed, entire towns emptied out, there was a run on a local bank, and a bank president committed suicide.
“The best business to be in at the time would have been the moving business,” said Bacon, noting that thousands of residents fled the Grand Valley, which without warning was left in dire straits.
“It was total chaos. There was a big boom and an even bigger bust,” said Andrew Gulliford, a history professor at Fort Lewis College in Durango who authored Boomtown Blues: Colorado Oil Shale. “For many people, it’s a sobering event they look back on much like John F. Kennedy’s assassination — what were they doing? – but unlike with JFK’s assassination, they had to put their lives back together.”
It took a decade before the region bounced back. Now the Grand Valley’s economy is far more diversified. The outdoor recreation industry, organic farmers and vintners all depend on its environs.
Some of the locals who stuck around slapped “Exxon Sucks Rocks” bumper stickers on their cars and trucks, referring to the technology that heats shale rock and sand to extract organic kerogen, or fossilized algae, and refine it into synthetic fuel. Despite trying for nearly a century, engineers have so far been unable to make oil shale — not to be confused with shale oil — commercially viable.
Chevron is the latest to abandon oil shale in Colorado. The company was one of just three to hold oil shale leases in the state. Royal Dutch Shell and AMSO are the other two. Chevron, which began amassing acreage in Colorado for oil shale research back in the 1930s, decided it had other priorities.
Even so, enthusiasm for oil shale has been flowing through the chambers of Congress where men like U.S. Rep. Doug Lamborn, R-Colo., are vigorously trying to open more public land to oil shale drilling despite objections from conservationists and studies that warn about diminishing water supplies.
The resource’s potential keeps companies coming back too. Earlier this year Shell said it produced 1,700 barrels of oil from an oil shale project on private land in western Colorado and it recently broke ground on its first project on Bureau of Land Management property. A company executive recently declared that Shell, which began researching oil shale in 1981, is making “significant progress.”
Those who have seen this play out before are urging decision-makers to proceed with caution.
“I don’t think anybody knows exactly how this is going to end,” Bacon said. “If it really works out, it would be a tremendous boon, but we thought that was going to happen in the 1980s and it didn’t. Oil shale was going to be a big thing in the 1920s. Several times they got excited and it just didn’t gel.”
A new report, Oil Shale: A Century of Failure, from the Checks and Balances Project (pdf) details the devastation oil shale has had on communities. The Checks and Balances report comes as the BLM is closing its public comment period on its new oil-shale development plan (pdf).