Fuel Fix » Shell pulls out of oil shale project, leaving one big operator behind

But while some parts of Washington, D.C. were focused on western oil shale, drilling was beginning to boom in other parts of the U.S., as companies began combining hydraulic fracturing and horizontal drilling to yank oil and gas from tight rock formations.

“As a matter of basic economics, oil shale does not make the cut,” said David Abelson, oil shale policy adviser at Western Resource Advocates, a group that opposes the development. “The technology isn’t there. And there are other opportunities.”

Fundamentally, energy companies are up against a geological problem as well as an economic one, he noted: Government incentives haven’t been able “to overcome the basic thermodynamics and economics of oil shale.”

The government has been integrally involved in oil shale before. In 1980, for instance, Congress created a corporation — backed by tens of billions in subsidies — with the goal of exploiting oil shale rock.

Ross Lane, director of the Western Values Project, said its time for lawmakers to stop “pretending that oil shale makes any economic sense.”

“Taxpayers have underwritten projects like these for nearly 100 years,” he said. “It’s time to spend our limited resources elsewhere.”

via Fuel Fix » Shell pulls out of oil shale project, leaving one big operator behind.

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