By Richard Martin, Contributing Editor

In the last couple of weeks two new reports have emerged that take a clear-eyed look at the prospective oil-shale boom on the Western Slope. Though they were produced by the Center of the American West, at the University of Colorado, and Headwaters Economics, two left-leaning think tanks, they are admirably objective and non-ideological. Both, however, raise serious questions about the more exuberant predictions for oil shale’s potential.

The Headwaters report, entitled “Oil Shale in the West:
14 Unanswered Questions,” is the more skeptical. Building a commercially viable oil-shale industry in the kerogen-rich Green River Formation, which stretches across the borders of Colorado, Utah, and Wyoming, would require “developing an industry at a volume exceeding the current average daily crude oil production in Saudi Arabia and 150 times greater than the combined total of existing worldwide oil shale production,” notes author Julia Haggerty.

Some pointed questions about oil shale have not been addressed, including “Will mining activities on a scale rivaling the world’s largest mines stand up to federal regulatory review such as NEPA?” and “Could the already over-allocated Colorado River Basin support cumulative new water demands that rival the volume used by the nation’s largest cities?”

The implied answer is “Unlikely.”

Center of the American West director Patricia Limerick, along with co-author Jason Hanson, raises some of the same points in “What Every Westerner Should Know About Oil Shale.”  “Doing it right in Shale Country will mean developing operations that address not just the technical challenges of oil shale recovery but that are also mindful of social, economic, and environmental consequences,” they write.

Oil shale research and development has been slowed under the Obama Administration, but it has not halted. Earlier this year Interior Secretary Ken Salazar, the former senator from Colorado, reversed a last-minute Bush Administration ruling  to open Western public lands for oil shale exploration. Kathleen Sgamma, government affairs director for the Denver-based Independent Petroleum Association of Mountain States, called the move “part of a pattern of decisions by the secretary that are detrimental to all sources of domestic energy.” But Salazar only postponed the lease sale, he didn’t cancel it. And experimental R&D projects on new technologies to extract oil from shale deposits continues not only on thousands of acres of privately held land but on 160 acres of Bureau of Land Management land granted to energy companies under the Energy Policy Act of 2005.

Underscoring the industry’s belief in the eventual potential of shale deposits, BG Group, the U.K.’s third- largest natural-gas company, paid $1.06 billion this week to acquire its first U.S. shale gas project. “Oil shale has the potential shift the center of gravity in the U.S. petroleum supply away from the Persian Gulf and to the Americas, thus freeing the nation from our reliance on unfriendly oil producers overseas,” the Center of the America West report notes.

Remarkably, the energy industry has embraced the report’s conclusions. Tracy Boyd, unconventional oil spokesperson for Shell Exploration and Production Co., told NewWest.Net, “It’s a very well-balanced, very well-done, comprehensive report.”

Some impartial perspective on oil shale is certainly welcome, given the outlandish forecasts, and near-hysterical opposition, that the resource has generated to date. Given the vast potential of the Green River deposits, it’s inevitable that they’ll be developed one way or another, as the price of conventional oil rises and the scarcity of other energy sources becomes more acute. It’s possible that energy producers have learned enough from past experience to know that they can’t plow ahead on such a massive undertaking without foreseeing, and accounting for, the social and environmental costs that come with it. Taking a serious look at these two new studies would be a good first step.