Oil Shale - a really bad idea for a serious problem

Oil shale is kind of like the the lunatics of the Project For A New American Century - just when you think you've beaten them back they come back with a vengeance. I have been meaning to write on this guest post over at Joe Gandelman's The Moderate Voice a few days ago by J. Thomas Andrews,
Oil Shale to the Rescue?
The only thing oil shale might rescue is the multi-national energy companies. Now Mr Andrews begins with some things I agree with:

1. Ethanol from corn or anything else in not a solution.
2. Hybrid vehicles are not a solution.
3. ANWR is not a solution.

But then he tries to sell energy from oil shale.

However, we have another source of domestic petroleum that has the potential to make a big difference: oil shale.

Oil shale is a type of rock that has a petroleum precursor called kerogen trapped inside of it. Using a variety of mechanical and chemical processes, this kergoen can be extracted and upgraded into liquid fuels like synthetic gasoline and synthetic diesel. The United States has the largest oil shale resources in the world. Most of America’s oil shale deposits are located in the undeveloped Green River Formation, which straddles Colorado, Wyoming, and Utah. According to the Rand Corporation, as much as 1.1 trillion—yes, trillion— barrels of synthetic petroleum could be recovered from the Green River Formation. According to the U.S. Department of Energy, that is four times the size of Saudi Arabia’s proved reserves of conventional oil, and approximately equal to all of the proved reserves of conventional oil on earth!


Oil shale has received little attention in recent decades, but some Americans probably remember hearing about the resource during the Arab oil embargoes. In 1980, at the height of the embargoes, the U.S. Congress created the Synthetic Fuels Corporation, which was, in part, intended to develop America’s oil shale industry. When the Synthetic Fuels Corporation was created it was incredibly expensive to squeeze petroleum out of oil shale, and the plan was to invest in research and development to pioneer cheaper methods to produce shale oil. House Majority Leader, Rep. Jim Wright of Texas, thought so highly of the bill that created the Synthetic Fuels Corporation that he described it as “the most important bill we’ll act on during this decade, beginning an initiative we should have started in the 1950s.” However, by 1985, after the Arab embargoes ended and the price of oil plummeted, the incentive to invest in oil shale plummeted as well. Nearly every oil shale project in America was abandoned. With conventional oil selling at less than $25/Bbl, why would anyone want to invest in oil shale, which looked like it would never break the $80/Bbl profitability threshold?

Over the past few years though, a few things have changed. First, the price of oil has again skyrocketed. And, unlike in the 1980s, the price of oil does not look like it will come down again. This is because the peak in global production is fast approaching while demand is surging: limited supply and higher demand can only mean higher prices. Moreover, the Persian Gulf oil powers will likely continue to inflate oil prices as their stranglehold over the petroleum market tightens. As a 2005 Citigroup report noted, “…the days of $25 oil are long gone and unlikely to return any time soon.” Governments and businesses around the world are now forecasting long-term oil prices above $40, $50, and even $60 a barrel. These could all be conservative estimates.

The second major change relevant to oil shale is that several companies operating under the radar screen have developed radically cheaper oil shale production methods over the past few years. Shell is confident that a new technology it is pioneering could produce shale oil profitably if the price of crude settles above ~$25/Bbl.

There are of course several problems with oil shale production.

1. It is still a hydrocarbon and will do nothing to reduce our carbon footprint.
2. The environmental impact over several thousand square miles will be devastating.
3. The production requires water - lots of it.

I'm going to concentrate on number three today - that is enough to make it impractical.

The oil shale is located in the Green River formation which is located in Colorado, Utah and Wyoming. Colorado, which has most of the shale, already has a serious water problem which will only get worse over time.
Oil Shale Development Will Threaten Water Supplies

A commercial oil shale industry is projected to have a dramatic effect on Colorado’s water supplies and potentially its water quality. Water requirements for traditional mining and surface retort oil shale development are well documented, but estimates for in-situ production, which is being proposed at five sites in the Piceance Basin of Colorado, haven’t been made public. This water would have to come from a combination of Colorado’s unused share of the Colorado River– if any remains – and from existing users such as the agricultural and ranching operations.

“Drought and population growth are already affecting valuable water supplies across the West,said David Atkins, an independent hydrologist with Watershed Environmental. Adding the substantial requirements for a commercial-scale oil shale industry to this mix might bring the region to the tipping point.

”Producing oil from shale uses water on site both during and after production (to cleanse the production zone after the oil has been extracted). For example, Shell recently disclosed in a permit application for its small research and demonstration site that it will have to rinse its underground production area over 20 times, requiring up to 4 acre-feet each day for over two years and resulting in massive water disposal challenges.

[.....]

The oil shale deposits of the Green River Basin lie in one of the country’s most arid regions, one whose vulnerability to drought was laid bare in the past six years. The availability of new water to meet the needs of a commercial oil-shale industry is far from certain. Decisions made about oil shale leasing today could have ramifications for the next 400 years, the period of time that western oil shale resources are expected to provide a significant portion of our nation’s energy needs.

Oil shale is not a solution.