SHALE AND DOUGH

There are 600 billion barrels of oil in the oil shale of the mountain statesÑtwice as much as the proven reserves of all of the Middle East. Almost all of the land containing low sulfur shale is owned by the Federal Government. In 1968, Interior Secretary Udall hoped for at least S80 million in bids for leases for three Colorado tracts. The highest bid he got was half a million, and he withdrew the offer in disgust. With oil controlled at $3.50 a barrel, oil companies were not about to sink hundreds of millions into projects that would produce, if the environmentalists let them, oil at a cost of $5 a barrel.

Last month, with "new" oil $8.50 and moving up, the government tried again, with a 5000 acre Colorado tract. This time the leading bid, by Standard Oil of Indiana and Gulf, was a whopping $210.3 million, followed by Sun Oil's S175 million bid. The three highest bids did not include the Occidental Oil Co., which has developed an in situ process (Nov. 73 AtE) with virtually zero environmental impact.

Mining the shale and retorting it to extract the oil mav oresent waste disposal problems in an area where water is not plentiful. However, the producers are obliged to adhere to air and water pollution standards, and until test projects are tried, no one will know what the impact will be.

Except, of course, the environmental fanatics. One month before the bids were opened, and one month after the Arab oil embargo, the Rocky Mountain Chapter of the Sierra Club announced plans to counter oil shale retrieval by "lobbying, lawsuits and other court action," and the Colorado Open Space Council charged that the program was a giveaway. Though environmentalism is a hobbyhorse ridden almost exclusively by the affluent, this appears to be the first time that $210 million has been termed "a giveaway."

On the other hand, Colorado gubernatorial candidate Lamm, who has been beating the environmental drum for some years, changed his tune to a well known Arab melody. After Colorado had raked in $16 million from the Standard Gulf bid, he introduced a bill in the state legislature to slam a 12.5% severance tax on shale oil.