Published on
the Salt Lake Tribune

Oil Shale Frenzy

Bush rules a gift to oil companies

Salt Lake Tribune Editorial

It's still November, but Christmas is arriving early for fossil-fuel extraction companies that have had oil shale on their wish lists for years.

The Bush administration's Interior Department wants to open millions of public acres in Utah, Colorado and Wyoming to oil companies to extract kerogen, a sludgy form of oil, from shale rock. As Bush's days in Washington wind down, his agents are working to give Big Oil a firm toehold on public lands by sidestepping the usual public-appeal process and adopting regulations that give companies a deal on royalties.

New rules would require payment of only a 5 percent royalty on oil shale for the first five years of production, while regular oil and gas wells pay 12.5 to 18.8 percent -- a nice gift to energy companies that American taxpayers could end up paying for in environmental degradation?.

The traditional processes for producing oil from shale, which require huge amounts of water and produce millions of tons of CO2, are potentially dangerous for the fragile deserts and high plains of the West. There is too little data on the effects of such invasive extraction.

Experiments are on-going for a less-harmful method that is more resource-friendly. Until new technology is developed -- and it is apt to take a decade, researchers say -- the federal government should hold back on leases for what amounts to large-scale strip mining for oil.

The economic feasibility of oil-shale extraction waxes and wanes according to the price of oil on the world market. When oil prices are high, it's worth the expense to mine oil from shale -- about $37.75 to $65.21 a barrel, compared with $19.50 a barrel for conventional crude. But when oil prices drop, companies abandon the projects, often devastating local economies. Utah saw such boom-bust cycles in the '80s, to our regret.

The rule-setting process for oil shale mining was halted by a congressional moratorium two years ago. That moratorium was allowed to expire this year, largely in response to record-setting fuel prices and the Republican mantra, "Drill, baby, drill." Utah's Democratic Rep. Jim Matheson irresponsibly joined the GOP chorus.

America must wean itself off carbon-based energy. By continuing to provide lavish incentives for oil production, instead of encouraging conservation and alternative energy development, we merely quicken our pace toward catastrophic climate change caused by the burning of fossil fuels.

This is the world we live in. This is the world we cover.

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