Rules tightened for Utah oil-shale leases

Interior Secretary Ken Salazar announced a new round of research and development leases for oil shale in Utah and two other Western states, but the potential projects come with drastically reduced available acreage, stringent timelines and a wider spectrum of impacts that must be addressed compared with the leases offered two years ago.

At the same time, Salazar said he is asking for an investigation into a list of "additions" rushed through in the waning days of the Bush administration to the 2007 leases, additions he said give him "serious concerns."

The Tuesday announcement from Washington, D.C., via teleconference was meant to encourage exploration of tapping the states' vast amounts of oil shale, but it is encouragement that comes with crucial questions that need answering, Salazar said.

Concerns over the commercial viability, the amount of water required, the source of that water and impacts on surrounding communities and wildlife have to be contemplated and explained in future projects, he said.

"We have to have the answers to those questions before we lunge ahead full scale" into an oil shale development program, Salazar cautioned.

The parameters in this second round of leases offered for research, development and ultimately demonstration if viable are starkly different from the previous round, which has been legally challenged by conservationists and environmentalists.

The number of leases made available will hinge on industry interest, Salazar said.

In addition to application fees that have more than tripled to $6,500 from $2,000, the changes from the first round to the second round include:

Initial project size of 160 acres with potential for an additional 480 acres if commercially feasible, rather than an additional 4,950 acres.

Nominations for projects must examine in more detail water use, energy use, water quality impacts and environmental impacts.

Requirements to submit development plans within nine months, obtain permits within 18 months and submit quarterly reports detailing progress.

"We want to avoid the booms and busts of the past and ensure that development is done where environmentally appropriate," Salazar said.