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The U.S. Bureau of Land Management proposes a second lease in Utah to test oil shale mining technologies, the agency announced Wednesday.
An Interior Department review team, which received state input, recommended the BLM consider three new leases, BLM spokesman Vince Vogt said. Two are on Colorado's West Slope and one is in eastern Utah's Uintah County, south of the White River and near the Colorado line. Once the BLM's Utah office conducts an environmental study to determine if a lease there makes sense, a Chinese-backed company called AuraSource Inc. plans to test its process for crushing and cooking kerogen-laced rock into oil.
"We're very pleased with the news," said AuraSource Chief Financial Officer Eric Stoppenhagen, based in California. The lease will employ 250 for a year or two of research, he said, and the workers would live in Vernal or on the lease site.
Environmentalists hope to block this new round of shale leases, though, and can raise issues as the BLM conducts its study during the next four months to a year.
So far, no one has proven that oil shale can produce marketable oil at an economical price. Western Resource Advocates says the government should wait for the first round of leases, issued during the Bush administration, to pan out. Five of those leases are in Colorado and one is in eastern Utah's Uintah County, north of the AuraSource site.
"It's in its infancy," David Abelson, an oil-shale policy adviser to Western Resource Advocates, said of research from the earlier leases. "It doesn't make sense to say, 'These guys are stuck in neutral, they're not really doing anything, let's issue more leases.' "
He called tapping federal lands for this research a subsidy for dirty fuels.
Stoppenhagen said federal land is needed because that is where the richest oil-shale deposits are located.
Environmentalists oppose shale development because its mining and processing require more fossil fuel use than does conventional oil, and it has the potential to leave large mining scars and deplete water resources.
AuraSource is licensed to used a patented Chinese energy institute-produced technology in the U.S. It's a secret "low-temperature catalytic process" using "minimal water," Stoppenhagen said.