Oil shale rules completed - New Mexico Business Weekly:

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Colorado Gov. Bill Ritte r Jr. and his administration have opposed opening federal landss for commercial oilshale operations, sayingf it is short-sighted to pursue commercial-scale oil shale development that “does nothing to address gas prices at the pump todahy and has the potential to do much more harm than Ritter said Sept. 4 that more study is neederd on thepossible environmental, economic, community and energhy impacts of oil shale. Commerciak production isn’t expected to arrivde for a decadeor more, Stephenb Allred, the assistant secretary of land and mineralds management at the , said in a conference call Monday.
But Allred said now is a good time to issue rules oncommercial “Companies will spend hundreds of millions of dollars,” Allred said. “Wse believe that a set of rulesw of the road are needesd by which they can judgethosse activities. We believe it’s important that rulexs will bring certainty not only to those that are goinf to investthe money, but also thoser who want to make sure there’s due diligence and that environmentalp concerns are being considered going Before leases can be issued, or development more environmental studies will be done, Allres said.
Western oil shale basins are believedf to hold as much as 800 billiomn barrels ofoil — enougj to supply the United States, at current demand, for 110 year s — Allred said. If and when oil is actuallyg pumped fromthe basins, operators would pay the federapl government a 5 percent royalty, based on the valuer of the oil, for the first five years. After that, it risex every year to the normal 12.5 percengt royalty the federal government charges for access to minerales onits lands. Forty-nine percent of the royalties are shared with the states within which the leasesare found.
Along with releasing its operationes rules foroil shale, Allred signed the departments finall decision on a preliminaryh environmental study that openzs 1.9 million federally owned acres in Colorado, and Utah for oil shale leasing. U.S. Sen. Ken D-Colo., issued a statement criticizingthe regulations, callingb them “premature and flawed.” Salazar said the Bush administratiojn is rushing ahead even though the administratiojn “has admitted that it has no idea how much of Colorado’as water supply would be required to develop oil shale on a commerciakl scale, no idea where the power wouldc come from, and no idea whether the technology is even viablw on a commercial scale.
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