Water and Power - The Ripple Effect: The Fate of Freshwater in the Twenty-First Century - page 248

of Saudi Arabia's proven reserves. At peak production, oil companies could retort 1.55
million barrels of shale oil per day in Colorado, the BLM said, which would require
378,000 acre-feet of water (Denver uses 300,000 acre-feet of water annually).
But western Colorado is naturally arid, its population is growing, and water is in high
demand. The nearest significant supply of water is the already stressed Colorado River.
So oil companies have done what Los Angeles did in the Owens Valley and what Pat
Mulroy did in central Nevada: quietly purchase property with significant water rights,
in this case to prepare for the day when it is economical and technically feasible to ex-
tract synthetic crude from shale. In 2007 and 2008, Shell went on a buying spree in Co-
lorado, shrewdly focusing on properties with “senior” water rights, those that predate
the water rights of businesses, such as farms and ski resorts, and thus have legal preced-
ence under Western water law. Shell acquired a large ranch with water rights dating to
the 1860s, as well as a piece of land near Mack with a thirty-thousand-acre-foot reser-
voir and rights to Colorado River water. It also swapped properties with the state for
land along Piceance Creek. By 2009, Shell had thirty-one conditional rights and own-
ership in five irrigation ditches in the Colorado and White River Basins. Shell also filed
for substantial water rights on the Yampa River and began snapping up properties near
Grand Junction. ExxonMobil owned forty-nine conditional claims and forty-eight ir-
rigation ditches, mostly in the White River Basin.
Although major oil-shale production is not likely to begin until 2020, and oil com-
panies are working to improve the water-to-oil ratio, ranchers and environmentalists
worry that the industry—which has acquired 7.5 million acre-feet of water rights —will
suck Colorado dry. If too much water is used to mine shale oil, they fear, the state might
be liable—either because it cannot meet its water delivery obligations under the Color-
ado River Compact or will not meet limits set by the Endangered Species Act. Ranchers
have a different worry.
“A shift of water to oil shale will dramatically change the landscape,” WRA executive
director Karin Sheldon warned. “It could mean an end to agriculture and to the historic
economic base of these rural communities.”
A few hundred miles north of the Colorado oil shale fields, tension between oil and wa-
ter has been growing since the discovery of vast deposits of tar sands , another source of
synthetic crude oil, in Ontario and Alberta, Canada. Tar sand consists of quartzite, clay,
water, and the “tar,” which is the heavy hydrocarbon bitumen (similar to what is found
in shale oil).
The first commercial operation to exploit it to produce oil was established in Alberta,
in 1930. Today, Fort McMurray, a small town set among rippling hills on the Athabasca
River, in northern Alberta, is a tar sands boomtown. Since the mid-1990s, residents