Senate Energy and Natural Resources Committee to examine oil shale issues

May 15: The Senate Energy and Natural Resources Committee will hold a hearing about US oil shale resource development. Scheduled witnesses include C. Stephen Allred, assistant US Interior secretary for land and minerals management; Colorado Gov. Bill Ritter; Terry O'Connor, vice president for external and regulatory affairs at Shell Exploration and Production Co. in Denver; Steve Smith, assistant regional director of the Wilderness Society in Denver, and Jim Hansen, representing Oil Shale Exploration Co. in Farmington, Utah. The hearing will begin at 2:30 p.m. in Room 366 of the Dirksen Senate Office Building.

Why it matters: As crude oil prices have climbed, domestic oil shale deposits in Colorado, Utah and Wyoming have grown more economically attractive. The 2005 Energy Policy Act established a framework to develop policies for federal leasing. Colorado state and local government officials have expressed concern about potentially adverse social, economic and environmental impacts which could occur without adequate planning. Members of the state's congressional delegation successfully inserted a one-year moratorium on leasing policy development into the federal omnibus budget act which President Bush signed into law in December.

The hearing will come after the full Senate's scheduled Tuesday votes on competing Democratic and Republican energy bills, but it will likely cover similar ground. Shell E&P is considered the leading company in pursuing federal leases and developing a process to free oil trapped in the shale deposits. But there are still questions concerning disruptions from mining and whether alternatives can be developed. Several members of Congress would rather see research and development directed toward developing alternatives to fossil fuels which would not contribute as heavily to global climate change.

This congressional committee has called a more representative group of witnesses to testify than has been seen in other House and Senate hearings. Ritter has an ally in committee member Ken Salazar (D-Colo.), who led Senate efforts to impose the moratorium. But Pete V. Domenici (R-N.M.), the ranking minority member, is one of the Senate's strongest oil shale development advocates. The hearing could get lively.

Contact Nick Snow at nicks@pennwell.com

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