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Counties hope to gauge potential economic impacts of oil shale development

Western Slope county governments have learned from the past and are trying to stay a step ahead of future oil shale development. The Associated Governments of Northwest Colorado has commissioned an oil shale economic impact study that it hopes will help counties, cities and towns prepare for the possible onslaught.Since the boom and bust of oil shale in the early 1980s, the industry has been virtually nonexistent in Garfield County. But a congruence of circumstances has put it back on the radar in the last couple of years.Last summer the Department of Energy’s Office of Naval Petroleum and Oil Shale Reserves published a report that predicted a shortfall in the worldwide oil supply within the next 20 years and called for development of oil shale as a strategic energy source.The recent passage of the federal energy bill also gave immediate impetus to oil shale’s resurgence, calling for commercial development in the next few years. The Bureau of Land Management will also offer its lands for lease, notably in the Piceance Basin of western Colorado, to energy companies for oil shale research and development.”The Department of Energy is talking about one million barrels of oil (from shale) a day by 2020,” said AGNC executive director Jim Evans.Shell Oil is currently experimenting with an in-situ process in the Piceance Basin south of Meeker that would extract oil by heating the enclosed rock formation. Shell has said it does not expect its technology to be commercially viable for seven to 10 years. In the first year of the three-year impact study, Glenwood Springs economic consultant Dennis Stranger will collect baseline information about the numbers of people employed in various sectors of the local economies in Rio Blanco, Garfield and Moffat counties, as well as salary ranges, Evans said.”We wanted to get ready, between BLM’s leasing and the energy bill,” Evans said. “We wanted to get a snapshot of where we are right now … and track what happens.”Evans has worked at AGNC since the 1970s and saw local governments go through the economic and social chaos of the bust, precipitated by Exxon’s pullout from its Colony Oil Shale plant in Parachute on May 2, 1982, which put over 2,000 out of work in one day.The study “is something we didn’t do the last time around,” he said.With the baseline data in hand, the second and third years of the study will focus on creating a projection of just how a full-blown oil shale industry with its new workers and their families moving into the region will affect the economy. Such projections will help counties and municipalities plan for the future, Evans said.”We’re hoping (the projections) will give us as local governments a heads-up … so we can stay out ahead (of the economic impacts),” said Garfield County Commissioner Larry McCown, who sits on the AGNC oil shale advisory committee.Data from the AGNC study will also dovetail with a similar but broader-reaching socio-economic study funded by Garfield County and set to begin early next year.That study, said county oil and gas auditor Doug Dennison, will look at many industries that drive the local economy, including oil and gas.Like the oil shale study, the county effort will also be used to predict growth over the next 10 to 20 years, Dennison said.In addition to finding out how many workers could be employed in the burgeoning oil and gas industry in the county, it will also look at where they would live and how far they’d commute to work.”This will probably raise issues about traffic and housing costs,” he said.A separate but related study will also look at whether or not the oil and gas industry is affecting land values in the county.Contact Donna Gray: 945-8515, ext. 510dgray@postindependent.com


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