Secretary Salazar to Offer a New Round of Oil Shale Research, Development and Demonstration Leases

WASHINGTON, D.C. – The Department of the Interior will offer a second round of research, development, and demonstration leases for oil shale in Colorado and Utah and withdraw the previous administration's proposal for expanded RD&D leases, Secretary of the Interior Ken Salazar announced today.

“We need to push forward aggressively with research, development and demonstration of oil shale technologies to see if we can find a safe and economically viable way to unlock these resources on a commercial scale. The research, development, and demonstration leases we will offer can help answer critical questions about oil shale, including about the viability of emerging technologies on a commercial scale, how much water and power would be required, and what impact commercial development would have on land, water, wildlife, and communities.”

The Department has submitted a notice that will appear in the Federal Register on Friday, Feb. 27, 2009 that will ask industry, local communities, states, and stakeholders for their advice on what the terms and conditions of the second round of RD&D leases should be. That comment period will be open for 90 days.

“Following that, the Department will move ahead with a solicitation for RD&D leases, based on sound policy and public input,” Salazar said. “This will help us restore order to a process that, under the previous Administration, was turned upside down. We look forward to hearing from the public, industry, and local communities as we move toward offering a second round of research, development, and demonstration leases.”

Salazar said he was withdrawing the previous Administration's solicitation on RD&D leases because it included several flaws, including locking in low royalty rates that would shortchange taxpayers. “The previous Administration offered their RD&D oil shale leases just days before leaving office, made the parcels four times the size of the current six RD&D leases, and then locked in low royalty rates and a premature regulatory framework for those leases,” the Secretary said. “If oil shale technology proves to be viable on a commercial scale, taxpayers should get a fair rate of return from their resource.”

As a U.S. Senator, Salazar helped author the provision in the 2005 Energy Policy Act that created the current RD&D leasing program, under which Interior's Bureau of Land Management offered six 160 acre parcels for companies to do research and development of oil shale technologies.