Learning from, or repeating, the history of Black Sunday
Thirty years ago tomorrow morning, about the time most of you will be scanning your Daily Sentinel while sipping early morning coffee, one of the defining moments in western Colorado history was occurring.
It was Black Sunday. May 2, 1982. Exxon was shutting down its oil shale project, leaving thousands of workers outside locked gates near Parachute and effectively ending a boom fueled by frenzied expectations of more abundant, lower-priced gas and independence from foreign sources.
Three decades later, the trillions of tons of marlstone containing “immature” precursors to oil in the remote parts of northwestern Colorado, northeastern Utah and southwestern Wyoming that comprise “the next Saudi Arabia” again fuel rosy expectations. We hear, again, what have been termed “the four most dangerous words” — “This time it’s different.”
This time is different in some ways. Technologies being researched utilize techniques much different than the last time to create oil from rock, although some still envision mining and cooking the shale in a manner similar to 1980s’ efforts. What’s not different this time is the politics that often overwhelm the measured pace of science.
Long lines at gas pumps, high prices and 1970s oil embargos, coupled with rejection of then-President Jimmy Carter’s sweater-clad entreaties to turn down thermostats and conserve, prompted politicians to throw subsidies at the industry. Billions in public- and private-sector dollars didn’t force the rock to yield its potential bounty in any commercially sustainable manner.
Thirty years later, some of our politicians want to throw millions of acres of public land, not dollars, at an industry not yet ready to use the resources beneath those lands to our benefit.
Many want to believe that premature action will save a few dollars each time we fill up, ignoring that increasing worldwide demand and speculation now drive fuel prices. Some hope leasing raw land for technologies not yet commercially viable will provide independence from foreign supplies without asking why a nation seeking energy self-sufficiency would have among its largest exports finished petroleum products.
Some perspective may also be helpful in comparing “this time” with “last time.”
All of the impacts and turmoil before and after Black Sunday came as a result of producing between 5 million and 6 million barrels of oil from shale over several years. That’s just 10 days worth of the volume anticipated this time under the mid-range 550,000 barrels-per-day scenario anticipated today.
The industry, if and when it develops, could provide good jobs, spin off other economic activity and grow sales and property tax revenues. That’s the part proponents tout.
That level of production would also produce serious socio-economic impacts, displacing some other economic drivers in agriculture and tourism and forcing local governments and current taxpayers to fund infrastructure and service demands long before significant tax and royalty revenues flow. That’s not discussed much.
Instead most current rhetoric flows around a supposed need for certainty and incentives, not impacts and mitigation.
Few ask why a company like Shell, with $7.2 billion in worldwide profits in just the third quarter of 2011 and a history of investing millions of dollars and decades of effort in still-incomplete oil shale research before acquiring rights to any federal land, needs reduced royalty rates or speculative leasing to move forward.
Or if there’s any real reason, other than politics, why counties approve specious resolutions containing unsubstantiated estimates of 8 trillion barrels of oil in the shale, more than six times the 1.5 trillion barrels Congress, the BLM and other agencies cite and twice the most optimistic estimate issued to date.
At least other local governments, including the cities of Rifle and Grand Junction and counties like Routt and Pitkin, are among others whose comments in the current BLM process outline potential problems, as well as benefits, and urge a more careful approach.
“History,” former West German Chancellor Konrad Adenauer once said, “is the sum total of things that could have been avoided.”
What’s needed “this time” as we remember Black Sunday is acknowledgement that political rhetoric in county courthouses or the halls of Congress won’t trump science — that subsidies, whether in dollars or in land, can’t force success in the marketplace. And that, if history has taught us anything, we must prepare for much larger impacts of potential oil shale development rather than wait to react.