Shale industry scales back potential in region
An oil shale industry in Colorado, Utah and Wyoming is likely to be about one-third the size it had been envisioned, an industry association said.
Instead of a 1.5-million barrel-per-day industry, the more likely scenario is a 500,000-barrel-per-day industry, according to estimates by the National Oil Shale Association.
The estimates were dramatically reduced “in light of a more pragmatic view of what an industry might look like in 50 years or so,” the association said, in an estimate that also noted that oil shale production would demand less water than had been previously believed.
The United States in 2013 consumed 6.89 billion barrels of petroleum products or 18.89 million barrels per day, according to the U.S. Energy Information Administration.
The oil shale association’s estimate is based on production of 225,000 barrels per day from in-situ means, or heating shale deep below the surface; 200,000 barrels per day from retorting shale on the surface; and 75,000 barrels per day from modified techniques, such as heating it in an earthen capsule, which is left in place.
Additional information about water demands of each technique sharply lowered the association’s estimate of water use from its 2013 estimate of 1.7 barrels of water per barrel of oil.
Depending on approach, production from oil shale could require between 0.7 barrels of water per barrel of oil to 1.2 barrels of water per barrel of oil.
Production of 500,000 barrels per day could demand between 16,400 acre feet to 28,900 acre feet of water per year.
Colorado, Utah and Wyoming all are in the upper basin of the Colorado River and are required under an agreement with lower-basin states to deliver 75 million acre feet of water per year, or an average of 7.5 million acre feet each year, to the lower basin.
The reduction in the anticipated size of an oil shale industry is the result of new information that came to light this year, the association said.
“Projects have matured, and some developers have taken a new look into technologies that dramatically reduce water needs,” the association said. “However, estimates are still preliminary and may change as projects reach commercialization.”