Interior pulls Bush eleventh hour oil shale leases

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Reuters: “A Bush administration plan for demonstration oil shale leases will be scrapped because the proposal is flawed and royalties to the government are too low, Interior Secretary Ken Salazar said on Wednesday. ‘If oil shale technology proves to be viable on a commercial scale, taxpayers should get a fair rate of return from their resource,’ he told reporters on a teleconference.”

More coverage from the Salt Lake Tribune (Patty Henetz):

Making good on a promise he made a week before President Barack Obama took office, Interior Secretary Ken Salazar on Wednesday tossed out a Bush administration move to speed oil-shale development on public land in Utah and Colorado. During a teleconference, Salazar called the Bush rule one of many flawed last-minute policies “that don’t pass the smell test.” Earlier this month, the new Interior boss shelved leases for oil and gas drilling near national parks in Utah. Wednesday’s announcement means any additional research-and-development leases the U.S. Bureau of Management may have offered after mid-January won’t go forward. Under the Bush regulation, the leases would have allowed substantially more acreage and set royalties at 5 percent, a figure Salazar said would sell taxpayers short.

More coverage from the Deseret News (Amy Joi O’Donoghue):

Yet another blow was delivered to Utah’s oil industry Wednesday by U.S. Interior Secretary Ken Salazar with his announcement that he is cancelling a second round of offering oil shale research and development leases on federal land in Utah, Wyoming and Colorado…

The decision marks the second time Salazar has reversed a decision of the previous administration involving Utah’s public lands. Earlier, he rescinded bids made on 77 parcels of Bureau of Land Management land for potential oil and gas development offered at a December auction in Salt Lake City. He characterized the offering of the bids in much the same way, saying the Bush administration rushed headlong into the process in the waning days of the administration without proper review. Some of the parcels, he said, were located in close proximity to many Utah landmarks, including Canyonlands and Arches national parks…

Steve Bloch, attorney with the Southern Utah Wilderness Alliance, lauded Salazar’s decision. “What he is proposing makes a lot of sense, and that is not to rush ahead pell-mell and offer large swaths of land until companies can affirmatively demonstrate that shale development is economically feasible and can be done in an environmentally sound and sustainable manner.”

More Coyote Gulch coverage here and here.

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