Salazar withdraws oil lease

http://www.bizjournals.com/denver/stories/2009/02/23/daily46.html

From the Denver Business Journal:

Wednesday, February 25, 2009

Interior’s Salazar withdraws oil lease offering

Interior Secretary Ken Salazar is starting anew on a second round of oil shale leases for the development of technologies to mine crude oil locked in rocks under federal lands in western Colorado, Utah and Wyoming.

The U.S. Department of the Interior said Wednesday a notice will appear on Friday in the Federal Register asking industry, local communities, states and stakeholders for their advice on the terms and conditions that should be included in the second round of leases.

The comment period will be open for 90 days.

Salazar, formerly a U.S. senator from Colorado, said in a statement he decided to withdraw a lease offering done in the last days of President George W. Bush’s administration “because it included several flaws, including locking in low royalty rates that would shortchange taxpayers.

“The previous administration offered their RD&D [research, development and demonstration] oil shale leases just days before leaving office, made the parcels four times the size of the current six RD&D leases, and then locked in low royalty rates and a premature regulatory framework for those leases,” he said.

“If oil shale technology proves to be viable on a commercial scale, taxpayers should get a fair rate of return from their resource.”

The first round of leases for research and development were issued in 2005.

“I applaud Secretary Salazar’s commitment to take a more deliberate look at the Bush administration’s hasty decision to offer a second round of oil shale research development and demonstration leases," Colorado Gov. Bill Ritter said Wednesday in a statement.

“Well-designed research and development efforts are a necessary first step to the kind of thoughtful and deliberate approach that oil shale requires," Ritter added. "We welcome the opportunity to provide input on how RD&D leases can best answer questions about what the significant implications of commercial-scale oil shale development means to Colorado’s Western Slope communities.”