HOUSTON (Dow Jones Newswires), Jan. 14, 2009
The federal government opened Wednesday the second round of land leases for oil shale research in the western United States.
The Bureau of Land Management is soliciting nominations for parcels to be leased in Colorado, Utah and Wyoming, according to the agency's news release.
"Broadening the scope of research into oil shale technologies will help accelerate the development of these vast western resources, and as a result lessen our dependence on foreign sources of energy," James Caswell, bureau's director said in a news release. The bureau is part of the U.S. Department of Interior.
President-elect Barack Obama's pick for Secretary of the Interior, Sen. Ken Salazar, D-Colo., has been against an expansion in oil-shale leases, saying that it could threaten his region's scarce water supplies. Salazar's confirmation hearing is scheduled for Thursday.
Oil shale is a fine-grained sedimentary rock that contains organic matter from which oil may be produced. However, the unconventional source is costly to extract. In 2005, the government embarked on the first round and issued six oil shale leases in Colorado and Utah in two years.
The program could result in up to 800 billion barrels of recoverable oil, according to the bureau.
U.S. holds more than half of the world's oil shale resources, with the largest known deposits located in the Green River formation in Colorado, Utah and Wyoming, according to the U.S. Geological Survey.
In an effort to encourage new technology, the bureau said it will only consider applications that demonstrate a method not currently being tested in the first round of leases.
The second round of leases will be issued for 10 years with a maximum of 640 acres.
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