Energy-Water Nexus:

A Better and Coordinated Understanding of Water Resources Could Help Mitigate the Impacts of Potential Oil Shale Development

GAO-11-35: Published: Oct 29, 2010. Publicly Released: Nov 29, 2010.

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Oil shale deposits in Colorado, Utah, and Wyoming are estimated to contain up to 3 trillion barrels of oil--or an amount equal to the world's proven oil reserves. About 72 percent of this oil shale is located beneath federal lands, making the federal government a key player in its potential development. Extracting this oil is expected to require substantial amounts of water and could impact groundwater and surface water. GAO was asked to report on (1) what is known about the potential impacts of oil shale development on surface water and groundwater, (2) what is known about the amount of water that may be needed for commercial oil shale development, (3) the extent to which water will likely be available for commercial oil shale development and its source, and (4) federal research efforts to address impacts to water resources from commercial oil shale development. GAO examined environmental impacts and water needs studies and talked to Department of Energy (DOE), Department of the Interior (Interior), and industry officials.

Oil shale development could have significant impacts on the quality and quantity of water resources, but the magnitude of these impacts is unknown because technologies are years from being commercially proven, the size of a future oil shale industry is uncertain, and knowledge of current water conditions and groundwater flow is limited. In the absence of effective mitigation measures, water resources could be impacted from ground disturbances caused by the construction of roads and production facilities; withdrawing water from streams and aquifers for oil shale operations, underground mining and extraction; and discharging waters produced from or used in operations. Estimates vary widely for the amount of water needed to commercially produce oil shale primarily because of the unproven nature of some technologies and because the various ways of generating power for operations use differing quantities of water. GAO's review of available studies indicated that the expected total water needs for the entire life cycle of oil shale production ranges from about 1 barrel (or 42 gallons) to 12 barrels of water per barrel of oil produced from in-situ (underground heating) operations, with an average of about 5 barrels, and from about 2 to 4 barrels of water per barrel of oil produced from mining operations with surface heating. Water is likely to be available for the initial development of an oil shale industry, but the size of an industry in Colorado or Utah may eventually be limited by water availability. Water limitations may arise from increases in water demand from municipal and industrial users, the potential of reduced water supplies from a warming climate, fulfilling obligations under interstate water compacts, and the need to provide additional water to protect threatened and endangered fishes. The federal government sponsors research on the impacts of oil shale on water resources through DOE and Interior. DOE manages 13 projects whose water-related costs total about $4.3 million, and Interior sponsored two water-related projects, totaling about $500,000. Despite this research, nearly all of the officials and experts that GAO contacted said that there are insufficient data to understand baseline conditions of water resources in the oil shale regions of Colorado and Utah and that additional research is needed to understand the movement of groundwater and its interaction with surface water. Federal agency officials also said they seldom coordinate water-related oil shale research among themselves or with state agencies that regulate water. Most officials noted that agencies could benefit from such coordination. GAO recommends that Interior establish comprehensive baseline conditions for water resources in oil shale regions of Colorado and Utah, model regional groundwater movement, and coordinate on water-related research with DOE and state agencies involved in water regulation. Interior generally concurred with GAO's recommendations.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: On August 13, 2012, the U.S. Geological Survey (USGS) and the Bureau of Land Management (BLM) established a Memorandum of Agreement (MOA) as a step towards establishing responsibilities and a coordinated understanding of water resources in the Piceance Basin where oil shale technologies are being tested and developed. The MOA remains in effect for 10 years, until 2022, in order to address the long-term nature of these efforts. In 2013, USGS issued two reports to help establish baseline conditions for ground and surface waters and identified gaps that needed to be filled in order to fully reflect the water conditions. According to Department officials, a regional water-monitoring strategy to fill these gaps was discussed but not drafted due to the lack of oil shale development activity in the Basin. During 2013-2014, USGS, the Colorado School of Mines, and DOE worked together to begin developing a GIS based infrastructure of water resources in the Piceance Basin that could potentially support oil shale development if it were to occur in the future. On balance, BLM and USGS, in cooperation with other stakeholders, have taken steps over several years and plan to continue the development of the comprehensive baseline, as funding allows, to address GAO's recommendation. We are closing this recommendation as implemented because actions to date and continued efforts address the basic intent of this long-term recommendation.

    Recommendation: To prepare for possible impacts from the future development of oil shale, the Secretary of the Interior should direct the appropriate managers in the Bureau of Land Management and the U.S. Geological Survey to establish comprehensive baseline conditions for groundwater and surface water quality, including their chemistry, and quantity in the Piceance and Uintah Basins to aid in the future monitoring of impacts from oil shale development in the Green River Formation.

    Agency Affected: Department of the Interior

  2. Status: Closed - Implemented

    Comments: In 2013, USGS issued several reports that DOI officials and scientists note are key to the development of a model to better understand the hydrologic system in Colorado. According to USGS geo-scientists involved, these reports form an architecture or basic structure for analyzing the chemistry, age, and water movement in the Piceance Basin. The focus of this work has been the Piceance Basin since this area of Colorado has been significantly impacted by energy development and has been a key area of interest for oil shale demonstration, development, and potential production. These reports form the basis of a conceptual model that provide a starting point for a numerical model once additional data and funding are available. Given the long-term nature of this data collection and potential modelling effort, DOI said that as resources allow, it will continue to evaluate the results of monitoring efforts and collect other information that can be used to determine a numerical modelling approach. We are closing this recommendation as implemented because actions taken establish a basic structure for future modelling efforts and address the basic intent of our long-term recommendation.

    Recommendation: To prepare for possible impacts from the future development of oil shale, the Secretary of the Interior should direct the appropriate managers in the Bureau of Land Management and the U.S. Geological Survey to model regional groundwater movement and the interaction between groundwater and surface water, in light of aquifer properties and the age of groundwater, so as to help in understanding the transport of possible contaminants derived from the development of oil shale.

    Agency Affected: Department of the Interior

  3. Status: Closed - Implemented

    Comments: To coordinate water-related research, on August 13, 2012, the U.S. Geological Survey (USGS) and the Bureau of Land Management (BLM) created a Memorandum of Agreement (MOA) to establish responsibilities and a coordinated understanding of water resources in the Piceance Basin. Since this time, according to officials, USGS and BLM offices continue to meet on a regular basis to coordinate efforts in the Basin. With regard to coordination specifically with the Department of Energy (DOE), Interior officials said that coordination was initiated after the issuance of our report with the Office of Naval Petroleum and Oil Shale Reserves, but DOE's reorganization eliminated this office and related contacts. Beyond this change, USGS and BLM scientists note that they continue to interact with a range of stakeholders, including state governments, industry, and international companies at the annual Oil Shale Symposium. USGS also developed the Energy and Environment in the Rocky Mountain Area (EERMA) project to facilitate research mapping, datasets, and decision-support tools and has a Web-accessible data repository to provide access to historical and current information. We are closing this recommendation as implemented because Interior has coordinated and continues to coordinate these efforts with many of the stakeholders envisioned in the recommendation.

    Recommendation: To prepare for possible impacts from the future development of oil shale, the Secretary of the Interior should direct the appropriate managers in the Bureau of Land Management and the U.S. Geological Survey to coordinate with the Department of Energy and state agencies with regulatory authority over water resources in implementing these recommendations, and to provide a mechanism for water-related research collaboration and sharing of results.

    Agency Affected: Department of the Interior

 

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