Washington (Platts)--13May2009

The commercial use of oil from US oil shale deposits is likely at least
10 years away and will require technological advances to get past hurdles
standing in the way of its commercial use, Interior Secretary Ken Salazar said
Wednesday.

"Oil shale needs to be on the table," Salazar said. "But it needs to be
on the table in a realistic way."

Salazar spoke at an energy forum held by the US Chamber of Commerce
Institute for 21st Century Energy.

Interior's Bureau of Land Management estimates that oil shale in western
states could hold the equivalent of 800 billion barrels of oil, and proponents
have touted the area as the "Saudi Arabia of oil shale." But oil shale
extraction has attracted criticism for the massive water-use demands and
carbon dioxide emissions that come with its development.

Water use is a key issue of concern in the states where oil shale is
common: Colorado, Utah and Wyoming.

In February, Salazar said his department was reviewing regulations for
commercial oil shale leases, finalized in the final weeks of the
administration of former President George W. Bush, adding that the royalty
rates were flawed.

In his previous role as a Democratic senator for Colorado, Salazar urged
a slow approach to oil shale development in the US.

--Derek Sands, derek_sands@platts.com