Energy policy — oil shale: Shell withdraws Yampa River water rights application

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From the Associated Press via the Los Angeles Times:

Colorado, Wyoming and Utah are thought to hold 800 billion barrels of recoverable oil in shale. But critics of a federal management plan for developing oil shale on public lands say the process would use too much of the region’s scarce water.

Shell was hoping to obtain water rights from the Yampa River. The company, which is the U.S. unit of Royal Dutch Shell, left open the possibility of pursuing the project in the future. “The exact scale and timing for development will depend on a number of factors, including progress on our technology development, the outcome of regulatory processes, market conditions, project economics and consultations with key stakeholders,” the company said in a statement. Shell said the ultimate goal is to create an operation that is economically viable, environmentally responsible and socially sustainable.

The state was notified of Shell’s decision on Tuesday, Colorado Department of Natural Resources spokesman Theo Stein said.

More coverage from Kirk Siegler writing for KUNC. From the article:

A spokesman could not be reached for further comment Tuesday night. But the news is being cheered by a host of environmental groups and local officials. “In northwest Colorado, we were very concerned about the impacts with the current construction technique that they were proposing,” says Routt County Commissioner Doug Monger. The county is one of 25 entities that filed formal protests against Shell’s proposal. Monger says the county also had concerns with the amount of resources that were going to be required to extract the water.

More coverage from Dennis Webb writing for the Grand Junction Daily Sentinel. From the article:

“We reviewed our application in the context of our ongoing research and development activities and, in light of the overall global economic downturn that has affected our project’s pace, have decided not to pursue the Yampa water right at this time,” the company said in a prepared statement.

Grant Junction attorney Mark A. Hermundstad also announced the decision in an e-mail to other attorneys involved in the case, saying Shell was dismissing its claims for conditional water rights. “However, the withdrawal of the Yampa water rights application should not be construed as an indication that Shell is pulling out of oil shale development,” Hermundstad wrote. “Shell intends to continue its oil shale research and development activities with the ultimate goal of creating a commercial oil shale recovery operation that is economically viable, environmentally responsible and socially sustainable.”

More oil shale coverage here and here.

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