Interior proposal would limit commercial oil shale development on federal lands

The Interior Department on Friday issued a final plan to close 1.6 million acres of federal land in the West originally slated for oil shale development.

The proposed plan would fence off a majority of the initial blueprint laid out in the final days of the George W. Bush administration. It faces a 30-day protest period and a 60-day process to ensure it is consistent with local and state policies. After that, the department would render a decision for implementation.

The move is sure to rankle Republicans, who say President Obama’s grip on fossil fuel drilling in federal lands is too tight.

{mosads}Interior’s Bureau of Land Management cited environmental concerns for the proposed changes. Among other things, it excised lands with “wilderness characteristics” and areas that conflicted with sage grouse habitats.

Under the plan, 677,000 acres in Colorado, Utah and Wyoming would be open for oil shale exploration. Another 130,000 acres in Utah would be set aside for tar sands production.

The administration and Democrats said that while the plan would curtail what was originally sought for oil shale development, it still opens up a significant amount of land that was previously unavailable for the energy production method. 

The administration noted the plan pushed forward Friday also included two research, development and demonstration (RD&D) leases for oil shale development.

“The proposed plan supports the Administration’s all-of-the-above approach to explore the full potential our nation’s domestic energy resources and to develop innovative technology and techniques that will lead to safe and responsible production of resources, including oil shale and tar sands, which industry recognizes are years from being commercially viable, but require RD&D today,” Interior spokesman Blake Androff said.

Sen. Mark Udall (D-Colo.) praised the plan, saying the administration exercised the right amount of caution on oil shale development, which has not yet been brought to commercial scale and brings concerns about the amount of water used in the practice.

“I am glad the Interior Department is taking measured steps to encourage research and development of our oil shale resources. With water being one of our most precious commodities in the West, I have concerns about the potential impacts of commercial oil shale development. Nonetheless, I look forward to seeing this technology explored further,” Udall said in a Friday statement.

Oil shale development is not to be confused with drilling into shale formations for oil and natural gas. The practice, which involves separating hydrocarbons bound up in rocks, has not been widely executed since Exxon’s failed Colorado venture in the 1980s.

Bobby McEnaney, senior lands analyst with the Natural Resources Defense Council, praised Interior Secretary Ken Salazar for the proposed final plan.

“By significantly reducing the acreage of wilderness potentially available for leasing, Secretary Salazar is laying out a creative, thoughtful and more responsible approach in managing some of our most precious resources,” McEnaney said in a Friday statement.

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Congressional Republicans are not likely to be as pleased.

GOP lawmakers, along with some Democrats, have pushed for more fossil fuel production in the West. Republicans have led the charge, saying Obama’s policies on fossil fuel drilling on federal lands are too restrictive.

While Obama notes domestic oil-and-gas production has increased during his administration, Republicans contend that it is activity on private and state land that is driving the boost. They point to this year’s dip in oil-and-gas production on federal land — though levels are still higher than they were during the Bush administration.

The Congressional Western Caucus released a report in August to deliver that message.

“This proposal will place further limitations on the exploration and development of our country’s natural resources and is yet another example of how this administration continues to stand in the way of North American energy independence,” Rep. Ed Whitfield (R-Ky.), the chairman of House Energy and Commerce’s subcommittee on Energy and Power, said in a statement to The Hill.

Oil and gas lobby the American Petroleum Institute, an ally of congressional Republicans, slammed the decision.

Jack Gerard, the group’s chief, said Thursday he would take a “wait-and-see” approach to Obama’s second term to gauge whether he would live up to campaign rhetoric in which he praised the domestic oil-and-gas industry.

Reid Porter, the lobby’s spokesman, said Friday’s news was a disappointing sign from the administration.

“This is another step in the wrong direction that limits development and investment in one of the nation’s most energy-rich areas and goes against a prior government decision that would allow for research and development over a much wider geographical area. Just days after the election this decision by the administration sends negative signals to industry and capital markets at a time when we need to encourage growth and innovation in the U.S.,” Porter said in a statement to The Hill.

— This story was updated at 5:07 p.m.