Obama's big oil decision

Bush opened the door to oil shale, a huge energy source. Will Obama close the door too soon?

Despite his hopes for renewable energy, Barack Obama faces tough choices early in his term on whether to extract more oil within the US. Americans are still years, maybe decades, from kicking the oil habit. One reserve – with at least a century of supply – lies below the Rockies. Will a "green" president ignore this black ooze?

This immense reserve is called oil shale, although the "oil" is not ready for refineries nor is the surface rock that traps it really shale. Rather, the sediments, which extend across Colorado, Utah, and Wyoming, contain a waxy hydrocarbon called kerogen that, either with heat or chemical processing underground, can be turned into synthetic oil.

The certainty stops there, however, as several oil firms such as Shell and Chevron test ways to extract the substance as cheaply, cleanly, and with as little water and electricity as possible. Whether they can do all that is Mr. Obama's urgent dilemma – one imposed on him by President Bush.

In November, the Interior Department issued rules, which take effect before Jan. 20, that open a path for commercial development of oil shale by 2015, or within a two-term Obama administration.

Why the rush? Two reasons. First, the world's production of traditional crude will peak in about 12 years, according to the International Energy Agency (IEA), creating a potential for global conflict. And second, America's oil shale could yield up to 800 billion barrels of oil, or "three Saudi Arabia's."

One model for US action on oil shale is Canada's current extraction of Alberta's huge deposits of oil sands. If oil prices are high in coming years, both of these unconventional sources of transport fuel will be commercially viable. The IEA sees Canada's oil sands making up about 7 percent of oil production by 2020.

Obama is open to oil shale's promise. When he picked Colorado's Sen. Ken Salazar as his Interior nominee, he said: "If there's going to be a debate about oil shale, I want Ken at the table because he can help sort through what are legitimate claims about, you know, how productive that approach might be versus the kind of environmental degradation that is possible if we don't do it carefully."

Senator Salazar, whose state contains the biggest deposits, has been cautious about oil shale, saying issues from carbon emission to water use must be resolved first.

He and the new president would be wise to hold off imposing a moratorium on oil shale development until the field testing of the various extraction technologies provides more data on the costs and the effects on land, air, and water supplies. Much of the data – even the exact amount of oil – is out of date.

If Obama's planned $150 billion spending on renewable energy and efficiency can quickly and drastically reduce America's dependence on petroleum products – from gasoline to plastics – then oil shale could be safely left in the ground.

Use of shale oil, coal, and the other types of fossil fuels may indeed go the way of the dinosaur. But until clean energy wins the race, consumers – and voters – will expect their leaders to keep the lights on and transport moving, and at an affordable cost. An unconventional energy source such as oil shale must not be politically buried yet.

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