Fact Sheet: Oil Shale RD&D Environmental Assessment Process Bureau of Land Management Colorado

Who are the proponents of the five proposed Research, Development & Demonstration (RD&D) projects?

They are Chevron Shale Oil Company; EGL Resources, Inc.; and Shell Frontier, whose three separate proposals were all judged eligible for further consideration and NEPA analysis.

Why are these environmental assessments (EAs) being released at different times?

The EGL, Chevron and Shell EAs are being developed by separate contractors, which means that the EAs will be ready for publication at separate times.  The EA addressing the proposal submitted by EGL Resources, Inc. was the first of these analyses completed through BLM’s internal review process.  BLM is taking the time to thoroughly review the analysis in each EA to ensure that potential impacts to human health and the environment are appropriately addressed.  BLM anticipates releasing the Chevron and Shell EAs in the coming weeks.

Who paid for preparation of the EAs?

The companies proposing projects reached an agreement with the White River Field Office to cover the cost of the environmental analysis required under the National Environmental Policy Act (NEPA).

How can the public review the NEPA documents relating to each proposal?

The public may review the EA for each proposal online at http://www.co.blm.gov/wrra/nepa.htm A hard copy version of the EA is also available for review at the BLM White River Field Office and BLM Colorado State Office.

How can the public comment on the EAs?

BLM recommends submitting comments by mail to ensure your suggestions are received.  Comments may be submitted in writing to:
Bureau of Land Management
White River Field Office
73544 Highway 64
Meeker, CO 81506
Attn: Jane Peterson

Public comments may also be submitted online at: Colorado_OSRDDEA@blm.gov .  The BLM cannot guarantee receipt and consideration of comments mailed to other BLM e-mail accounts due to memory and security purposes.  The public comment period closes September 1, 2006.

Can the public review the comments the BLM receives on these preliminary EAs?

The public may review comments after the BLM has completed its internal comment analysis and has responded to the comments.

When are final decisions about awarding oil shale RD&D leases expected?

RD&D leases may be issued after the NEPA process is completed and if BLM concludes the proposed project(s) will have no significant impact on the human environment.  Final selection of successful proposals and publication of a decision record are expected to occur in mid-fall 2006. 

Does this timeline meet the requirements of Section 369 of the Energy Policy Act?

Yes.  The BLM met the requirements of Section 369 (c) when it published the call for RD&D nominations in the summer of 2005.

Where are the parcels associated with these proposals located?

EGL, Chevron and Shell’s proposed projects would all occur on public lands in the Piceance Basin in Northwest Colorado. The Piceance Basin contains the largest deposits of high grade oil shale in the United States.  The Green River Formation, of which the Piceance Basin is a part, contains an estimated 1.2 trillion barrels of shale oil.  The heart of the Basin, containing the richest deposits of oil shale, is predominately federal land managed by the BLM’s White River Field Office.

How much public land is involved in each proposed project?

Each proposal identifies the 160 acres allowed in the call for RD&D proposals published in the Federal Register in June 2005, along with an additional contiguous area of 4,960 acres to be reserved for a preferential right to convert to a commercial lease in the future if the technology is proven successful, economically viable, environmentally sound and once additional NEPA analysis is completed. 

Why have these five proposals been deemed eligible for further consideration?

Each of these proposals were judged to be eligible for further consideration by 1) including all the information required in the June 2005 Federal Register notice, 2) demonstrating potential to advance knowledge of oil shale recovery technology, 3) demonstrating potential economic viability, and 4) demonstrating means of minimizing environmental impacts.

What is different now in oil shale development compared to 20 years ago?

The Colorado projects propose to use in-situ (in-place) processes that had not been developed 20 years ago.  This and other new technologies for extracting oil from shale anticipate less environmental impact than methods used in the past.  Knowledge about oversight and mitigation has advanced in recent years.  The BLM will demand rigorous technological and environmental oversight and require the best available practices to minimize impacts on any oil shale lease the agency may eventually grant.  The RD&D effort is being carefully phased to ensure that newer extractive technologies will operate at economic and environmentally acceptable levels before conversion to commercial operations is authorized. 

What issues surround in-situ (in-place) methods?

In-situ methods involve issues similar to those associated with conventional oil and gas development.  The spacing of the holes drilled to insert heating elements and associated surface disturbance must be considered, as well as possible effects on air quality, surface water, and groundwater.  The effects of underground heating of the rock for long periods must also be examined.

Will extracting the oil require large open-pit mines and the disposal of waste rock?

The proposed projects in Colorado will use in-situ techniques and do not involve surface retorting or large open pit operations. 

Will the potential environmental impacts be greater than those from conventional oil and gas development due to the amounts of water and energy needed to process oil shale?

Many of the techniques in the proposals are new.  Advancing knowledge of commercially viable production, development and recovery technologies consistent with sound environmental management is the primary reason for conducting the RD&D program.  The EAs will include NEPA analysis of all the environmental effects of each proposal. If these effects exceed acceptable levels, the BLM will not grant an RD&D lease.  The RD&D leases are purposely limited to small 160-acre tracts so that newer methods can be demonstrated and data on their environmental effects developed in a controlled setting.

How are the possible social and economic effects of oil shale production being considered in evaluating these RD&D proposals?

Social and economic impacts are considered during any NEPA analysis.  Also, the presence of representatives of the three oil shale states on the interdisciplinary review team that reviewed the original nominations ensures that these concerns are being considered (along with environmental issues) at every phase of the RD&D program.

Will royalties be collected from these RD&D leases and will rental fees be charged?

Royalties on oil produced from RD&D leases will be waived until oil is produced in commercial quantities.  The Secretary of the Interior also waived the $2.00 per acre rental fee on RD&D leases for the first five years of the lease.

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