The Moffat County Board of Commissioners sent a strongly worded letter to the director of the Bureau of Land Management on May 28 deriding the proposed oil shale regulation amendments for inaccurate descriptions of oil shale development, failure to consider the economic impact of the proposed regulations and failure to abide by the 2005 Energy Policy Act.
The amendments are intended to open 810,000 acres of leasable land for oil shale in Colorado, Utah and Wyoming. If the proposed regulations are adopted, Colorado will actually end up with less land available for lease than it has currently.
“The 2005 EPA explicitly calls for the encouragement of responsible oil shale development. These proposed rule changes appear to be designed to do exactly the opposite,” said the board of commissioners in its letter.
The office of U.S. Colorado Sen. Michael Bennet sent the Craig Daily Press a statement that said the senator supports the proposed changes and expresses confidence that the amended regulations not only would increase technological advances but also will “help ensure that future development of oil shale in Colorado will consider the importance of our precious water resources which are critical to farmers, ranchers and our state’s economy.”
The proposed plan stresses conservation and environmental protection measures that exclude large swaths of Colorado from potential exploration, eliminating 320,350 acres that currently are available for lease application.
Slated for exemption to oil shale development are all areas identified as having wilderness characteristics, priority sage-grouse habitat, Areas of Critical Environmental Concern or areas under consideration to become an ACEC and all areas identified in a 2008 decision as off-limits.
These stipulations, in particular the exclusion of priority sage grouse habitat from development, would restrict greatly the available lease land in Moffat County, which is home to about two thirds of Colorado’s sage grouse population.
Leases also would be limited to highly productive areas that generate 25 gallons of oil per ton of rock with a thickness of less than 25 feet and require an air-shed review of scientific data, an integrated waste management plan, groundwater protection plan and an environmental protection to be approved.
“There already exist several mechanisms to address these issues… making this requirement a duplicative and redundant one,” the commissioners point out in their letter. They fear that the increased requirements will burden current or prospective lease-holders with prohibitive initial investments.
“The regulations are to manage a leasing program, but having those leases be profitable is something entirely different,” said BLM Division of Solid Minerals Chief Mitchell Leverette. “Oil shale development is in such a nascent introductory level. We haven’t seen in this country a method that’s financially viable.”
Ongoing research is essential to the development of new technologies that would make the oil shale extraction industry efficient and effective, but for those tied to the energy industry, the constraints of the proposed regulations would make progress impossible.
“Energy development has been an integral part of Moffat County for many decades,” the commissioners said. “We have a long history of balancing economic needs and conservation, and have found that the best way to foster such cooperation is through a regulatory environment that is stable and provides a level of security.”
According to the commissioners, the proposed royalty amendment could be crippling to potential oil shale producers because the replacement royalty structure proposals would not take into account the higher initial start-up costs for oil shale extraction operations.
“We certainly do not advocate for reckless or haphazard development,” the commissioners explained. “But neither do we believe that establishing cumulative roadblocks, inconsistency and uncertainty in the process is an acceptable route to take.”
The BLM will be accepting public comments on the oil shale regulation amendments through July 15.
For more information contact Andie Tessler at 970-875-1793