Matheson says oil-shale ban is likely to expire

Groups vow to press on to protect Utah lands

Published: Wednesday, Sept. 24 2008 12:00 a.m. MDT

The method is changing, but chances appear a bit stronger that Congress will lift a moratorium on oil-shale development in Utah, Colorado and Wyoming — although environmental groups say that would be a financial and ecological disaster.
Rep. Jim Matheson, D-Utah, said Tuesday the White House objected to including a variety of Democratic oil drilling and other energy provisions in a bill needed to avoid a government shutdown at the end of the month. So it all was dropped, including language he wrote to lift the oil-shale ban and replace it with state-by-state approval.
However, Matheson said supporters of the ban apparently do not have enough votes to extend the moratorium — which will expire at the end of the month otherwise. "I've not heard of any effort to extend the moratorium," he said.
Other news media said Democratic leaders also figure that not enough support exists for an extension.
"If the moratorium is not extended, that's still a big win. That goes further than my legislation" because no action by state legislatures would be needed for oil-shale development, Matheson said.
"At this point, it's either my language or no moratorium at all. Either is fine with me, and both would be a win for Utah," Matheson said.
Utah politicians generally favor oil-shale development. However, significant opposition exists in Wyoming and Colorado to the Bureau of Land Management issuing final rules that could allow commercial oil-shale leases. Some say that up to 1.8 trillion barrels of oil could be locked in oil shale in the three states.
David Alberswerth with The Wilderness Society is not conceding defeat. In a conference call with reporters, he said, "Our understanding is that issue has not been resolved yet. So I think it's important for those concerned about oil shale" to call Congress and urge an extension.
Groups ranging from Taxpayers for Common Sense to the Denver Water Board and National Wildlife Federation joined the conference call organized Tuesday by the Wilderness Society to warn that lifting the ban could be a disaster.
"That could cost taxpayers billions — that's billions with a 'b' — billions of dollars," said Jill Lancelot, co-founder of Taxpayers for Common Sense.
She complained that the BLM is proposing to charge only a 5 percent royalty on oil from oil shale, instead of the 12.5 to 18.8 percent royalty that it charges for other on- or offshore drilling. She said the BLM said the low royalty is needed to help prod development of oil shale.
"This is a recipe for yet another giveaway to the oil and gas industry," she said. "Commercial oil shale is in its very earliest stages of development, and we think we should not be developing a commercial leasing program when we have yet to develop the product."
Susan Daggett, a Denver Water Board commissioner, said the board worries that oil shale could swallow up all of the remaining water available in the Upper Colorado River Basin.
"Oil shale is extremely water-intensive, requiring, some estimate, two to four barrels of water for every barrel of oil that is produced," she said.
"That potentially pits people's needs against oil shale's needs," she said. "If the water is used for oil shale, it may not be available for use for communities ... and it may not be available for growth of any other industries."
Craig Thompson, a board member of the National Wildlife Federation, said he once worked on an experimental oil shale project while he was in college in Wyoming.
He said he found "oil shale is a dirty, toxic excuse for a fuel. Oil-shale development requires that we intrude into previous undeveloped lands, lands that are already threatened by oil and gas development, to exploit an unknown and an unproven resource."
Congress is aiming to adjourn at the end of the week, so the final outcome likely will be decided by then.

E-mail: lee@desnews.com

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