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Oil-Shale Waste ‘Non Hazardous,’ EPA Says

THE WALL STREET JOURNAL

DECEMBER 22, 2008, 4:49 P.M. ET

WASHINGTON — The Environmental Protection Agency issued an 11th-hour clarification on spent oil shale, declaring the byproduct of the development process not to be a hazardous waste.

The ruling could limit production costs if U.S. developers move ahead with oil shale development, but the next administration under President-elect Barack Obama is expected to put the brakes on commercial development.

Specifically, the EPA published data showing the characteristics of spent shale from operations indicate the waste is unlikely to be a hazardous waste. Oil shale is a fine-grained sedimentary rock that can be heated, vaporized, and upgraded to create a synthetic crude oil.

The 11th-hour notice is one of a multitude of “midnight” rules made in the waning days of President George W. Bush’s tenure, as department chiefs implement controversial regulations designed to imprint the current White House’s policy mark well into Mr. Obama’s administration.

In November, the Department of the Interior opened the western U.S. to commercial oil shale development after the expiration of a congressional ban that had so far only allowed demonstration projects such as the one operated by Royal Dutch Shell.

But Mr. Obama last week named Colorado Democrat Sen. Ken Salazar, an opponent of commercial oil shale development, to Interior Secretary. Analysts say the appointment portends a halt in oil shale lease sales.

While environmental concerns mainly focus on the carbon-dioxide emissions created from burning oil shale fuel and the quantities of water necessary for commercial development, the primary obstacle to development has so far been cost. It’s currently uneconomical to develop, especially as oil prices have fallen into the $40 a barrel range.

Write to Ian Talley at [email protected]

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