Boomtown Blues and Black Sunday, 28 years later

By Andrew Gulliford

Twenty-eight years ago today, on the first Sunday in May, 1982, Exxon, the largest corporation in the world, pulled the plug on its massive Colony oil shale project.

Overnight, 2,600 people lost their jobs. Overnight, small towns in Western Colorado learned difficult lessons about the speed of the corporate guillotine. Overnight, county commissioners and town planners learned that talk is cheap when oil gets cheaper.

The oil shale boom of the late 1970s and early 1980s had been one of the biggest booms and fastest busts in the history of the American West. I know. I was here.

Within the first week of May in 1982, there was not a U-Haul trailer to rent anywhere on the Western Slope. By summer’s end, perhaps 6,000 people had left the area as business dominos continued to fall. Bumper stickers proclaimed, “Exxon Sucks Rocks.” Communities learned the hard way what happens when a large multinational corporation changes course.

Fortune Magazine commented that Exxon’s abandonment of oil shale had all “the abruptness of a teenage driver making a screeching U-turn.” The bust hit hard because buildup to the boom had been tremendous.

In the mid-1970s, with an Arab OPEC oil embargo, Americans waited in line for gasoline. Scrambling to find additional petroleum reserves, energy companies turned to oil shale, which they had found too difficult and too expensive to process in the 1920s.

But oil shale is a kerogen embedded in tons of rock. It doesn’t flow like liquid crude. It takes massive amounts of energy and water to extract a single barrel of oil. Yet Exxon’s engineers with flamboyant corporate hubris claimed that by 2010, an oil shale industry would produce eight million barrels of oil a day.

Now, 28 years later, despite all the rosy predictions in Exxon’s infamous “White Paper” on oil shale, there is still no commercially viable oil shale industry. And there never will be.

The oil shale boom had been pure industry bravado, aided by federal subsidies.

Exxon’s “White Paper” bordered on “voodoo economics,” with projections for massive population growth on the Western Slope, large numbers of new power plants, giant shale pits deep enough in the earth to dwarf the height of the Empire State Building and water needs so excessive that engineers seriously suggested siphoning off the Missouri River and moving it uphill over the Continental Divide.

The West Slope’s pristine air quality would have deteriorated to that of Denver’s on a bad winter day. To add irony to the melodrama, Exxon christened its oil shale venture the Colony Oil Shale Project, and it even included a Vice President named William T. Slick.

As painful as the oil shale bust was — and it resulted in hundreds of foreclosures, business failures, dissolved marriages and an increase in wild game poaching — the 10-year business slump brought stability and a more sustainable economic and environmental mix to western Colorado. Retirees fleeing the Front Range or from other states came to enjoy life in Colorado’s small towns. Hunters and fishermen arrived in increasing numbers, as did a new crowd of mountain bikers and hikers. The same eco-blessings that locals had often taken for granted — clean air, pristine fly fishing waters and world-class elk hunting — drew a steady stream of new residents.

Within the last decade, an oil and gas boom replaced oil shale as an economic mainstay. Now, few people want a massive oil shale project that would take water from agriculture, require new power plants and bring in thousands of workers.

The oil shale calculus never has made sense. Not fiscally, not environmentally, not socially. The costs and impacts are too high. There’s a reason an oil shale industry did not work in the 1920s or in the 1980s, and it won’t work now. There’s nothing sustainable about it.

In my campus office I have a small slab of dark mahogany oil shale. It’s polished to a fine shine. I look at it often, but I’d never try to squeeze oil out of it.

John C. Sawhill of the Nature Conservancy has said, “In the end, our society will be defined not only by what we create, but by what we refuse to destroy.” Almost three decades after Black Sunday, it’s time to permanently toss in the towel on an oil shale industry.

Andrew Gulliford is a professor of Southwest Studies and History at Fort Lewis College in Durango. He is the author of “Boomtown Blues: Colorado Oil Shale,” which won the Colorado Book Award. He can be reached at .(JavaScript must be enabled to view this email address).


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