Right from the 1970s, oil shales have been touted as the solution to substantially reducing or even eliminating America's dependence on foreign oil. The US has the world's largest reserves of oil shales, with recoverable reserves of about 800 billion barrels [5,7] (about 3 times Saudi's conventional oil reserves), mainly located in the Green river basin in the states of Colorado, Utah and Wyoming. These form about 70% of the world resource of shale oil. However, before, oil shales can be developed on a commercial scale, a plethora of technical, policy as well as economic challenges need to be overcome.
Extraction of oil from shales requires methods very different from those used for conventional oil production. They contain solid kerogens (precursors to crude oil) and need to be retorted to high temperatures to convert the solid kerogen to liquid hydrocarbons. Oil shales are extracted mainly through two processes, surface mining and underground mining. In surface/open pit mining, the kerogen is mined and then retorted in external retorting plants. In in-situ retorting, the oil shale is retorted in-situ and the generated hydrocarbon is produced and refined. In addition to this, oil shales have historically been (even today in countries like Estonia) as fuel and used to generate electricity.
The most important policy challenges to the commercial development of oil shales are with respect to the substantial environmental impacts associated with them. The primary among these is the disturbance of land during mining and the associated damage to the ecology and biodiversity, which is more severe in the case of surface mining. There would be permanent topographic changes due to the surface disposal of spent shale. An environmental impact assessment needs to be done to determine the impact of oil shale development on the eco-system and suitable policies need to be formulated.
In addition to this, development of oil shales results in increased greenhouse emissions compared to even fossil fuels, primarily due to the huge amount of energy required for the retorting process. However, newer technologies [1] have reduced this to about the same level as coal. It also results in degradation of the water in the surrounding areas, besides competing for water use for residential industrial and commercial purposes.
New technological developments like Shell's thermally conductive in-situ conversion process, addresses many of the problems described above by minimizing the impact on land use and also reducing the energy requirement, thereby reducing the net greenhouse gas emissions of the process. It is also estimated [3] that this process would be viable at an oil price less than $30 per barrel as compared to the older oil shale mining and retorting techniques which require an oil price of above $70 to $95 per barrel. Shell has demonstrated [6] that this process is technically viable on a small scale and is working on its commercialization and sustainability.
The Energy Policy Act of 2005 [2,4] passed by the Congress provided for the commercial leasing of federal land for oil shale exploitation and increased the size as well as the number of land tracts leased. These were often a constraint for companies in getting efficient recovery in their tests. Further policy incentives like these, supporting R&D to overcome these challenges and possibly providing federal funding to some of these projects, especially those that study the environmental impact of the development of oil shales are urgently required.
Oil shales thus hold an enormous potential, provided we can overcome the above challenges. The size and richness of the US shale oil reserves combined with the evidence of possible commercial viability warrents a collaborative government-industry-public effort to augment US petroleum supplies. It should be a priority now to build a consensus to initiate an oil shale industry in the near future.
References
1. EASAC, "A study of the EU oil shale industry" (May 2007)
2. Bartis, J T; LaTourette, T; Dixon, L; Peterson D J; Cecchine, G; "Oil shale development in the United States, Prospects and policy issues"report by RAND for the NETL of the DOE
3. "Shale oil extraction technology Economically viable?", Futurepundit.com
4. Andrews, A; "Oil shales, History, incentives and policy" (April 2006), CRS report for the Congress
5. Fine, Daniel; "Oil shales: Towards a strategic unconventional fuel supplies policy" (Mar 8, 2007), Heritage.org
6. Shell US - In-situ conversion process page
7. Bunger, J W; Crawford, P M; "Is oil shale the answer to America's peak oil challenge? "Oil and Gas Journal (Aug 9, 2004)
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Although most everyone discusses the Green River Formation when it comes to oil shale there are some other options that might work out better depending on what your energy direction is. The Devonian shales of the eastern half of North America also have a significant total organic content, and although they are not as hydrogen rich type II kerogen bearing they are also rich in uranium and thorium. Depending on the price of recovery this might make a good secondary product. It would depend a lot on the advances in extraction as this sort of a process was used by the Russians from the 50s to the 80s on source material from the Dictyonema shale. This was just for Uranium, not hydrocarbons, but the shale is similar to North American Devonian shales. This will not get around the physical impact of mining but there is really no way to claim that most of this territory in the east is at all pristine, as the areas that are natural looking have been for the most part at least clear cut once.
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