Another company has given up on trying to develop oil shale in the Uinta Basin, faced with legal battles, environmental concerns and money going down the drain.
Estonia’s national energy company announced that it was wrapping up its fruitless oil shale venture in Utah at the end of last month. Estonia Finance Minister Mart Võrklaev said that the company’s project in Utah was “neither profitable nor promising” in a news release.
“Unfortunately, we can see that a mistake has been made,” he said in a statement.
Many have tried to develop oil shale in eastern Utah. Just as many have failed.
The Estonian company — which is the world’s largest oil shale processor — owns rights and land for 3.5 billion tons of oil shale in the Uinta Basin. Over a decade ago, Estonia planned for its American project to produce 57,000 barrels of oil shale per day.
Oil shale is a hard sedimentary rock that can be heated to release synthetic crude oil. It is a thirsty and expensive process that threatens air quality, water quality and endangered species, and exacerbates global warming, according to nonprofit Grand Canyon Trust staff attorney Michael Toll.
“This truly would have been a climate bomb,” Toll told The Salt Lake Tribune. “I don’t think it’s hyperbolic to say that this would have been one of if not the most harmful single project in the history of industrial development on the Colorado Plateau.”
Right now, the Utah Legislature is considering amendments to the state’s energy policy. The bill text indicates that Utah isn’t giving up on oil shale: “Utah shall encourage innovation in the development of energy resources, including emerging energy resources, including…oil shale.”
There were high hopes for Estonia’s Utah venture
(Scott Sommerdorf | The Salt Lake Tribune) Enefit mining engineer Ben France gestures towards the darker, "mahogany zone" of the oil shale deposit revealed on their private holdings in eastern Uintah County in 2013.
The United States Geological Survey estimated that the in-place resources of the Uinta Basin totaled 1.32 trillion barrels of oil in 2011. But despite millions of dollars spent by hopeful developers over the years, no one has found a way to make the resource flow in commercial quantities.
The American arm of Estonia’s national energy company, called Enefit American Oil, is the latest to try and unlock a treasure trove of oil in eastern Utah. Enefit acquired its land and rights to oil shale in the area over a decade ago.
Enefit wanted to build a 15-square-mile surface mine and a 9,000-acre power plant to process oil shale in the eastern Uinta Basin, near the White River. The plant would have been the first of its kind in the country. To keep it running, the company would need to transport utilities like water, power and natural gas to the plant — and build a pipeline to move the oil to refineries near Salt Lake City.
Locals were reportedly excited about the proposal. In 2013, then-Uinta County Commissioner Mike Mckee told The Tribune that the project would bring 2,000 jobs to the region. Enefit CEO Rikki Hrenko-Browning, who now serves as president of the Utah Petroleum Association, said that about 84% of Uinta Basin residents wanted their region’s oil shale developed in 2015.
But environmentalists were much less enthused.
One issue was the utilities that Enefit’s proposed power plant required. In order to get electricity, water and natural gas to the plant — and to get the oil out of the plant to refineries — the company needed to acquire rights of way from the Bureau of Land Management. Utility lines would have to run across public land in the Uinta Basin that surrounded Enefit’s private holdings.
The BLM granted the rights of way, a decision that environmental groups challenged in a federal district court in 2018. There has still not been a ruling issued for this case.
Environmentalists also criticized the water needed for oil shale development. Deseret Power Electric Cooperative, which owns the coal-fired Bonanza Power Plant in eastern Utah, agreed to let Enefit use its water to sustain its oil shale project.
Enefit’s proposals would have required 11,000 acre-feet of water per year from the Green River, a tributary to the drought-ridden Colorado River. A court filing from a coalition of environmental groups claimed that the same amount of water is consumed by the Uinta Basin’s existing municipal and industrial uses combined.
Grand Canyon Trust filed a protest with the Utah State Engineer against the agreement between Deseret Power and Enefit, believing it to be unlawful. Deseret Power and Grand Canyon Trust entered into a settlement agreement resolving the issue in August 2023, which prohibited the power company from using their water for fossil fuel development.
As a result, Enefit lost the water that was vital for their proposed oil shale operations.
In September 2023, Enefit relinquished its federal oil shale leases in eastern Utah, but still retained its private holdings and state leases from the Utah Trust Lands Administration. The company announced it was completely backing out of its Utah venture last month.
‘Catastrophic environmental and public health impact’
(Trent Nelson | The Salt Lake Tribune) The Green River's Horseshoe Bend, south of Vernal, on Wednesday, Nov. 17, 2021. Overflight provided by LightHawk.
Environmentalists cheered the end of Enefit’s oil shale venture in Utah.
“It would have had, without being hyperbolic, a catastrophic environmental and public health impact,” Toll said.
The Uinta Basin is plagued by unhealthy air and wintertime ozone, which the Utah Department of Environmental Quality attributes to oil and gas development in the region. If Enefit’s oil shale plans had panned out, they would have exacerbated the problem, Toll said.
Oil shale operations are also dirtier than conventional liquid oil. According to the nonprofit Union of Concerned Scientists, converting oil shale to gasoline or diesel can produce three times the greenhouse gas emissions of conventional oil.
Toll also expressed relief that the Green River’s scarce water would not be used for oil shale production.
“To develop this really experimental fossil fuel and use Utah’s public water resources to do so in a time of unprecedented megadrought gripping the West would have been ill-advised,” he said.
With Estonia looking to get rid of its land and mineral rights in Utah, another question remains: who could buy what they’re selling?
In their news release, Estonia’s national energy company estimated that their land and rights in Utah could take around a year to sell.
HB374: State Energy Policy Amendments — sponsored by Rep. Colin Jack, R-St. George, and Senate Majority Leader Evan Vickers, R-Cedar City — would direct the state to achieve “efficient utilization and development of: nonrenewable energy resources, including ... oil shale.”
The bill passed the House of Representatives last week and is making its way through the Senate.
