Energy Development and Water Use: Impacts of Potential Oil Shale Development on Water Resources
Published: 2011-08-24T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: 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 managed by the Department of the Interior's Bureau of Land Management, 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's testimony is based on its October 2010 report on the impacts of oil shale development (GAO-11-35). This testimony summarizes (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 such development and its source, and (4) federal research efforts to address impacts to water resources from commercial oil shale development. For its October 2010 report, GAO reviewed studies and interviewed water experts, officials from federal and state agencies, and oil shale industry representatives.
section_title: What GAO Found
paragraphs: Oil shale development could have significant impacts on the quality and quantity of water resources, but the magnitude is unknown because technologies are not yet commercially proven, the size of a future industry is uncertain, and knowledge of current water conditions is limited. In the absence of effective mitigation measures, water resources could be impacted by disturbing the ground surface during the construction of roads and production facilities, withdrawing water from streams and aquifers for oil shale operations, underground mining and extraction, and discharging waste waters produced from or used in such operations. Commercial oil shale development requires water for numerous activities throughout its life cycle, but 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 range 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, with an average of about 3 barrels. GAO reported that water is likely to be available for the initial development of an oil shale industry but that 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, the need to fulfill obligations under interstate water compacts, and decreases on withdrawals from the Colorado River system to meet the requirements to protect threatened and endangered fish species. The federal government sponsors research on the impacts of oil shale on water resources through the Departments of Energy (DOE) and Interior. Even with 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 told GAO that they seldom coordinate water-related oil shale research among themselves or with state agencies that regulate water. In its October report, GAO made three recommendations to the Secretary of the Interior to prepare for the possible impacts of oil shale development, including the establishment of comprehensive baseline conditions for water resources in the oil shale regions of Colorado and Utah, modeling regional groundwater movement, and coordinating on water-related research with DOE and state agencies involved in water regulation. The Department of the Interior generally concurred with the recommendations.
section_title: What GAO Recommends
paragraphs: GAO is making no new recommendations at this time.

section_title: Letter
paragraphs: I am pleased to be here today to participate in your field hearing on oil shale  development. As you know, being able to tap the vast amounts of oil locked  within U.S. oil shale could go a long way toward satisfying our nation’s future  oil demands. The Green River Formation—an assemblage of over 1,000 feet  of sedimentary rocks that lie beneath parts of Colorado, Utah, and  Wyoming—contains the world’s largest deposits of oil shale. The U.S.  Geological Survey (USGS) estimates that the Green River Formation  contains about 3 trillion barrels of oil and that about half of this may be  recoverable, depending on available technology and economic conditions.  This is an amount about equal to the entire world’s proven oil reserves. The  thickest and richest oil shale within the Green River Formation exists in the  Piceance Basin of northwest Colorado and the Uintah Basin of northeast  Utah (see app. I). The federal government is in a unique position to influence  the development of oil shale because 72 percent of the oil shale within the  Green River Formation is beneath federal lands managed by the Department  of the Interior’s (Interior) Bureau of Land Management (BLM). The  Department of Energy (DOE) has provided technological and financial  support for oil shale development through its research and development  efforts, but oil shale development has been hampered by technological  challenges, average oil prices that have been too low to consistently justify  investment, and concerns over potential impacts on the environment.
One area of particular concern is that developing oil shale will require large  amounts of water—a resource that is already in scarce supply in the arid  West where an expanding population is placing additional demands on  water. Some analysts project that large scale oil shale development within  Colorado could require more water than is currently supplied to over 1 million  residents of the Denver metro area and that water diverted for oil shale  operations would restrict agricultural and urban development. The potential  demand for water is further complicated by the past decade of drought in the  West and projections of a warming climate in the future. In October 2010, we  issued a report that examined the nexus between oil shale development and  water impacts.
My testimony today will summarize the findings of that report. Specifically,  I will discuss (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 the commercial development  of oil shale, (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 on water resources from commercial  oil shale development. To perform this work we, among other things,  reviewed an environmental impact statement on oil shale development  prepared by BLM and various studies from private and public groups; we  also interviewed officials at DOE, USGS, BLM; state regulatory agencies  in Colorado and Utah; oil shale industry representatives; water experts;  and organizations performing research, including universities and national  laboratories, and reviewed relevant documents describing their research.  We conducted this work in accordance with generally accepted  government auditing standards.
subsections: section_title: Background
paragraphs: Interest in oil shale as a domestic energy source has waxed and waned  since the early 1900s. More recently, the Energy Policy Act of 2005  directed BLM to lease its lands for oil shale research and development. In  June 2005, BLM initiated a leasing program for research, development,  and demonstration (RD&D) of oil shale recovery technologies. By early  2007, it granted six small RD&D leases: five in the Piceance Basin of  northwest Colorado and one in Uintah Basin of northeast Utah. The  leases are for a 10-year period, and if the technologies are proven  commercially viable, the lessees can significantly expand the size of the  leases for commercial production into adjacent areas known as  preference right lease areas. The Energy Policy Act of 2005 also directed  BLM to develop a programmatic environmental impact statement (PEIS)  for a commercial oil shale leasing program. During the drafting of the  PEIS, however, BLM realized that, without proven commercial  technologies, it could not adequately assess the environmental impacts of  oil shale development and dropped from consideration the decision to  offer additional specific parcels for lease. Instead, the PEIS analyzed  making lands available for potential leasing and allowing industry to  express interest in lands to be leased. Environmental groups then filed  lawsuits, challenging various aspects of the PEIS and the RD&D  program. Since then, BLM has initiated another round of oil shale RD&D  leasing.
Stakeholders in the future development of oil shale are numerous and  include the federal government, state government agencies, the oil shale  industry, academic institutions, environmental groups, and private citizens.  Among federal agencies, BLM manages the land and the oil shale beneath  it and develops regulations for its development. USGS describes the nature  and extent of oil shale deposits and collects and disseminates information  on the nation’s water resources. DOE, through its various offices, national  laboratories, and arrangements with universities, advances energy  technologies, including oil shale technology. The Environmental Protection  Agency (EPA) sets standards for pollutants that could be released by oil  shale development and reviews environmental impact statements, such as  the PEIS. Interior’s Bureau of Reclamation (BOR) manages federally built  water projects that store and distribute water in 17 western states and  provides this water to users. BOR monitors the amount of water in storage  and the amount of water flowing in the major streams and rivers, including  the Colorado River, which flows through oil shale country and feeds these  projects. BOR provides its monitoring data to federal and state agencies  that are parties to three major federal, state, and international agreements  that together with other federal laws, court decisions, and agreements,  govern how water within the Colorado River and its tributaries is to be  shared with Mexico and among the states in which the river or its tributaries  are located.
The states of Colorado and Utah have regulatory responsibilities over  various activities that occur during oil shale development, including  activities that impact water. Through authority delegated by EPA under  the Clean Water Act, Colorado and Utah regulate discharges into surface  waters. Colorado and Utah also have authority over the use of most water  resources within their respective state boundaries. They have established  extensive legal and administrative systems for the orderly use of water  resources, granting water rights to individuals and groups. Water rights in  these states are not automatically attached to the land upon which the  water is located. Instead, companies or individuals must apply to the state  for a water right and specify the amount of water to be used, its intended  use, and the specific point from where the water will be diverted for use,  such as a specific point on a river or stream. Utah approves the  application for a water right through an administrative process, and  Colorado approves the application for a water right through a court  proceeding. The date of the application establishes its priority—earlier  applicants have preferential entitlement to water over later applicants if  water availability decreases during a drought. These earlier applicants are  said to have senior water rights. When an applicant puts a water right to  beneficial use, it is referred to as an absolute water right. Until the water  is used, however, the applicant is said to have a conditional water right.  Even if the applicant has not yet put the water to use, such as when the  applicant is waiting on the construction of a reservoir, the date of the  application still establishes priority. Water rights in both Colorado and  Utah can be bought and sold, and strong demand for water in these  western states facilitates their sale.
A significant challenge to the development of oil shale lies in the current  technology to economically extract oil from oil shale. To extract the oil, the  rock needs to be heated to very high temperatures—ranging from about  650 to 1,000 degrees Fahrenheit—in a process known as retorting.  Retorting can be accomplished primarily by two methods. One method  involves mining the oil shale, bringing it to the surface, and heating it in a  vessel known as a retort. Mining oil shale and retorting it has been  demonstrated in the United States and is currently done to a limited extent  in Estonia, China, and Brazil. However, a commercial mining operation with  surface retorts has never been developed in the United States because the  oil it produces competes directly with conventional crude oil, which  historically has been less expensive to produce. The other method, known  as an in-situ process, involves drilling holes into the oil shale, inserting  heaters to heat the rock, and then collecting the oil as it is freed from the  rock. Some in-situ technologies have been demonstrated on very small  scales, but other technologies have yet to be proven, and none has been  shown to be economically or environmentally viable.
Nevertheless, according to some energy experts, the key to developing  our country’s oil shale is the development of an in-situ process because  most of the richest oil shale is buried beneath hundreds to thousands of  feet of rock, making mining difficult or impossible. Additional economic  challenges include transporting the oil produced from oil shale to  refineries because pipelines and major highways are not prolific in the  remote areas where the oil shale is located, and the large-scale  infrastructure that would be needed to supply power to heat oil shale is  lacking. In addition, average crude oil prices have been lower than the  threshold necessary to make oil shale development profitable over time.
Large-scale oil shale development also brings socioeconomic impacts.  There are obvious positive impacts such as the creation of jobs, increase  in wealth, and tax and royalty payments to governments, but there are  also negative impacts to local communities. Oil shale development can  bring a sizeable influx of workers, who along with their families, put  additional stress on local infrastructure such as roads, housing, municipal  water systems, and schools. Development from expansion of extractive  industries, such as oil shale or oil and gas, has typically followed a “boom  and bust” cycle in the West, making planning for growth difficult.  Furthermore, traditional rural uses could be replaced by the industrial  development of the landscape, and tourism that relies on natural  resources, such as hunting, fishing, and wildlife viewing, could be  negatively impacted.
Developing oil shale resources also faces significant environmental  challenges. For example, construction and mining activities can  temporarily degrade air quality in local areas. There can also be long-  term regional increases in air pollutants from oil shale processing,  upgrading, pipelines, and the generation of additional electricity.  Pollutants, such as dust, nitrogen oxides, and sulfur dioxide, can  contribute to the formation of regional haze that can affect adjacent  wilderness areas, national parks, and national monuments, which can  have very strict air quality standards. Because oil shale operations clear  large surface areas of topsoil and vegetation, some wildlife habitat will be  lost. Important species likely to be negatively impacted from loss of  wildlife habitat include mule deer, elk, sage grouse, and raptors. Noise  from oil shale operations, access roads, transmission lines, and pipelines  can further disturb wildlife and fragment their habitat. Environmental  impacts could be compounded by the impacts of coal mining,  construction, and extensive oil and gas development in the area. Air  quality and wildlife habitat appear to be particularly susceptible to the  cumulative effect of these impacts, and according to some environmental  experts, air quality impacts may be the limiting factor for the development  of a large oil shale industry in the future. Lastly, the withdrawal of large  quantities of surface water for oil shale operations could negatively impact  aquatic life downstream of the oil shale development. My testimony today  will discuss impacts to water resources in more detail.
section_title: Oil Shale Development Could Adversely Impact Water Resources, but the Magnitude of These Impacts Is Unknown
paragraphs: In our October report, we found that oil shale development could have  significant impacts on the quantity and quality of surface and groundwater  resources, but the magnitude of these impacts is unknown. For example,  we found that it is not possible to quantify impacts on water resources  with reasonable certainty because it is not yet possible to predict how  large an oil shale industry may develop. The size of the industry would  have a direct relationship to water impacts. We noted that, according to  BLM, the level and degree of the potential impacts of oil shale  development cannot be quantified because this would require making  many speculative assumptions regarding the potential of the oil shale,  unproven technologies, project size, and production levels.
Hydrologists and engineers, while not able to quantify the impacts from oil  shale development, have been able to determine the qualitative nature of  its impacts because other types of mining, construction, and oil and gas  development cause disturbances similar to impacts that would be  expected from oil shale development. According to these experts, in the  absence of effective mitigation measures, impacts from oil shale  development to water resources could result from disturbing the ground  surface during the construction of roads and production facilities,  withdrawing water from streams and aquifers for oil shale operations,  underground mining and extraction, and discharging waste waters from  oil shale operations. For example, we reported that oil shale operations  need water for a number of activities, including mining, constructing  facilities, drilling wells, generating electricity for operations, and  reclamation of disturbed sites. Water for most of these activities is likely to  come from nearby streams and rivers because it is more easily  accessible and less costly to obtain than groundwater. Withdrawing water  from streams and rivers would decrease flows downstream and could  temporarily degrade downstream water quality by depositing sediment  within the stream channels as flows decrease. The resulting decrease in  water would also make the stream or river more susceptible to  temperature changes—increases in the summer and decreases in the  winter. These elevated temperatures could have adverse impacts on  aquatic life, which need specific temperatures for proper reproduction and  development and could also decrease dissolved oxygen, which is needed  by aquatic animals.
We also reported that both underground mining and in-situ operations  would permanently impact aquifers. For example, underground mining  would permanently alter the properties of the zones that are mined,  thereby affecting groundwater flow through these zones. The process of  removing oil shale from underground mines would create large tunnels  from which water would need to be removed during mining operations.  The removal of this water through pumping would decrease water levels  in shallow aquifers and decrease flows to streams and springs that are  connected. When mining operations cease, the tunnels would most likely  be filled with waste rock, which would have a higher degree of porosity  and permeability than the original oil shale that was removed.  Groundwater flow through this material would increase permanently, and  the direction and pattern of flows could change permanently. Similarly, in- situ extraction would also permanently alter aquifers because it would  heat the rock to temperatures that transform the solid organic compounds  within the rock into liquid hydrocarbons and gas that would fracture the  rock upon escape. The long-term effects of groundwater flows through  these retorted zones are unknown. Some in-situ operations envision  using a barrier to isolate thick zones of oil shale with intervening aquifers  from any adjacent aquifers and pumping out all the groundwater from this  isolated area before retorting.
The discharge of waste waters from operations would also temporarily  increase water flows in receiving streams. These discharges could also  decrease the quality of downstream water if the discharged water is of  lower quality, has a higher temperature, or contains less oxygen. Lower- quality water containing toxic substances could increase fish and  invertebrate mortality. Also, increased flow into receiving streams could  cause downstream erosion. However, if companies recycle waste water  and water produced during operations, these discharges and their  impacts could be substantially reduced.
section_title: Estimates of Water Needs for Commercial Oil Shale Development Vary Widely
paragraphs: Commercial oil shale development requires water for numerous activities  throughout its life cycle; however, we found that estimates vary widely for  the amount of water needed to produce oil shale. These variations stem  primarily from the uncertainty associated with reclamation technologies for  in-situ oil shale development and because of the various ways to generate  power for oil shale operations, which use different amounts of water.
In our October report, we stated that water is needed for five distinct  groups of activities that occur during the life cycle of oil shale  development: (1) extraction and retorting, (2) upgrading of shale oil, (3)  reclamation, (4) power generation, and (5) population growth associated  with oil shale development. However, we found that few studies that we  examined included estimates for the amount of water used by each of  these activities. Consequently, we calculated estimates of the minimum,  maximum, and average amounts of water that could be needed for each  of the five groups of activities that comprise the life cycle of oil shale  development. Based on our calculations, we estimated that about 1 to 12  barrels of water could be needed for each barrel of oil produced from in- situ operations, with an average of about 5 barrels (see table 1); and  about 2 to 4 barrels of water could be needed for each barrel of oil  produced from mining operations with a surface retort operation, with an  average of about 3 barrels (see table 2).
section_title: Water Is Likely to Be Available Initially from Local Sources, but the Size of an Oil Shale Industry May Eventually Be Limited by Water Availability
paragraphs: In October 2010, we reported that water is likely to be available for the  initial development of an oil shale industry, but the eventual size of the  industry may be limited by the availability of water and demands for water  to meet other needs. Oil shale companies operating in Colorado and Utah  will need to have water rights to develop oil shale, and representatives from  all of the companies with whom we spoke were confident that they held at  least enough water rights for their initial projects and will likely be able to  purchase more rights in the future. According to a study by the Western  Resource Advocates, a nonprofit environmental law and policy  organization, of water rights ownership in the Colorado and White River  Basins of Colorado companies have significant water rights in the area. For  example, the study found that Shell owns three conditional water rights for  a combined diversion of about 600 cubic feet per second from the White  River and one of its tributaries and has conditional rights for the combined  storage of about 145,000 acre-feet in two proposed nearby reservoirs.
In addition to exercising existing water rights and agreements, there are  other options for companies to obtain more water rights in the future,  according to state officials in Colorado and Utah. In Colorado, companies  can apply for additional water rights in the Piceance Basin on the Yampa  and White Rivers. For example, Shell recently applied—but subsequently  withdrew the application—for conditional rights to divert up to 375 cubic  feet per second from the Yampa River for storage in a proposed reservoir  that would hold up to 45,000 acre-feet for future oil shale development. In  Utah, however, officials with the State Engineer’s office said that  additional water rights are not available, but that if companies want  additional rights, they could purchase them from other owners.
Most of the water needed for oil shale development is likely to come first  from surface flows, as groundwater is more costly to extract and generally  of poorer quality in the Piceance and Uintah Basins. However, companies  may use groundwater in the future should they experience difficulties in  obtaining rights to surface water. Furthermore, water is likely to come  initially from surface sources immediately adjacent to development, such  as the White River and its tributaries that flow through the heart of oil  shale country in Colorado and Utah, because the cost of pumping water  over long distances and rugged terrain would be high, according to water  experts.
Developing a sizable oil shale industry may take many years—perhaps  15 or 20 years by some industry and government estimates—and such  an industry may have to contend with increased demands for water to  meet other needs. For example, substantial population growth and its  correlative demand for water are expected in the oil shale regions of  Colorado and Utah. State officials expect that the population within the  region surrounding the Yampa, White, and Green Rivers in Colorado will  triple between 2005 and 2050. These officials expect that this added  population and corresponding economic growth by 2030 will increase  municipal and industrial demands for water, exclusive of oil shale  development, by about 22,000 acre-feet per year, or a 76 percent  increase from 2000. Similarly in Utah, state officials expect the population  of the Uintah Basin to more than double its 1998 size by 2050 and that  correlative municipal and industrial water demands will increase by 7,000  acre-feet per year, or an increase of about 30 percent since the mid- 1990s. Municipal officials in two communities adjacent to proposed oil  shale development in Colorado said that they were confident of meeting  their future municipal and industrial demands from their existing senior  water rights and as such will probably not be affected by the water needs  of a future oil shale industry. However, large withdrawals could impact  agricultural interests and other downstream water users in both states, as  oil shale companies may purchase existing irrigation and agricultural  rights for their oil shale operations. State water officials in Colorado told  us that some holders of senior agricultural rights have already sold their  rights to oil shale companies. A future oil shale industry may also need to  contend with a general decreased physical supply of water regionwide  due to climate change; Colorado’s and Utah’s obligations under interstate  compacts that could further reduce the amount of water available for  development; and limitations on withdrawals from the Colorado River  system to meet the requirements to protect certain fish species under the  Endangered Species Act.
Oil shale companies own rights to a large amount of water in the oil shale  regions of Colorado and Utah, but we concluded that there are physical  and legal limits on how much water they can ultimately withdraw from the  region’s waterways, which will limit the eventual size of the overall  industry. Physical limits are set by the amount of water that is present in  the river, and the legal limit is the sum of the water that can be legally  withdrawn from the river as specified in the water rights held by  downstream users. Our analysis of the development of an oil shale  industry at Meeker, Colorado, based on the water available in the White  River, suggests that there is much more water than is needed to support  the water needs for all the sizes of an industry that would rely on mining  and surface retorting that we considered. However, if an industry that  uses in-situ extraction develops, water could be a limiting factor just by  the amount of water physically available in the White River.
section_title: Federal Research Efforts on the Impacts of Oil Shale Development on Water Resources Do Not Provide Sufficient Data for Future Monitoring
paragraphs: Since 2006, the federal government has sponsored over $22 million of  research on oil shale development and of this amount about $5 million  was spent on research related to the nexus between oil shale  development and water. Even with this research, we reported that there is  a lack of comprehensive data on the condition of surface water and  groundwater and their interaction, which limits efforts to monitor and  mitigate the future impacts of oil shale development. Currently DOE funds  most of the research related to oil shale and water resources, including  research on water rights, water needs, and the impacts of oil shale  development on water quality. Interior also performs limited research on  characterizing surface and groundwater resources in oil shale areas and  is planning some limited monitoring of water resources. However, there is  general agreement among those we contacted— including state  personnel who regulate water resources, federal agency officials  responsible for studying water, water researchers, and water experts— that this ongoing research is insufficient to monitor and then subsequently  mitigate the potential impacts of oil shale development on water  resources. Specifically, they identified the need for additional research in  the following areas:    Comprehensive baseline conditions for surface water and  groundwater quality and quantity. Experts we spoke with said that  more data are needed on the chemistry of surface water and  groundwater, properties of aquifers, age of groundwater, flow rates  and patterns of groundwater, and groundwater levels in wells.    Groundwater movement and its interaction with surface water.
Experts we spoke with said that additional research is needed to  develop a better understanding of the interactions between  groundwater and surface water and of groundwater movement for  modeling possible transport of contaminants. In this context, more  subsurface imaging and visualization are needed to build geologic  and hydrologic models and to study how quickly groundwater  migrates. Such tools will aid in monitoring and providing data that  does not currently exist.
In addition, we found that DOE and Interior officials seldom formally share  the information on their water-related research with each other. USGS  officials who conduct water-related research at Interior and DOE officials  at the National Energy Technology Laboratory (NETL), which sponsors  the majority of the water and oil shale research at DOE, stated they have  not talked with each other about such research in almost 3 years. USGS  staff noted that although DOE is currently sponsoring most of the water- related research, USGS researchers were unaware of most of these  projects. In addition, staff at DOE’s Los Alamos National Laboratory who  are conducting some water-related research for DOE noted that various  researchers are not always aware of studies conducted by others and  stated that there needs to be a better mechanism for sharing this  research. Based on our review, we found there does not appear to be any  formal mechanism for sharing water-related research activities and  results among Interior, DOE, and state regulatory agencies in Colorado  and Utah. The last general meeting to discuss oil shale research among  these agencies was in October 2007, but there have been opportunities  to informally share research at the annual Oil Shale Symposium, such as  the one that was conducted at the Colorado School of Mines in October  2010. Of the various officials with the federal and state agencies,  representatives from research organizations, and water experts we  contacted, many noted that federal and state agencies could benefit from  collaboration with each other on water-related research involving oil  shale. Representatives from NETL stated that collaboration should occur  at least every 6 months.
As a result of our findings, we made three recommendations in our  October 2010 report to the Secretary of the Interior. Specifically, we  stated that to prepare for possible impacts from the future development of  oil shale, the Secretary 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;    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; and  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.
Interior generally concurred with our recommendations. In response to  our first recommendation, Interior commented that there are ongoing  USGS efforts to analyze existing water quality data in the Piceance Basin  and to monitor surface water quality and quantity in both basins but that it  also plans to conduct more comprehensive assessments in the future.  With regard to our second recommendation, Interior stated that BLM and  USGS are working on identifying shared needs for modeling. Interior  underscored the importance of modeling prior to the approval of large- scale oil shale development and cited the importance of the industry’s  testing of various technologies on federal RD&D leases to determine if  production can occur in commercial quantities and to develop an accurate  determination of potential water uses for each technology. In support of  our third recommendation to coordinate with DOE and state agencies with  regulatory authority over water resources, Interior stated that BLM and  USGS are working to improve such coordination and noted current  ongoing efforts with state and local authorities.
In conclusion, Mr. Chairman, attempts to commercially develop oil shale  in the United States have spanned nearly a century. During this time, the  industry has focused primarily on overcoming technological challenges  and trying to develop a commercially viable operation. However, there are  a number of uncertainties associated with the impacts that a commercially  viable oil shale industry could have on water availability and quality that  should be an important focus for federal agencies and policymakers going  forward.
Chairman Lamborn, Ranking Member Holt, and Members of the  Committee, this completes my prepared statement. I would be pleased to  respond to any questions that you may have at this time.
section_title: Contact and Staff Acknowledgments
paragraphs: Contact points for our Offices of Congressional Relations and Public  Affairs may be found on the last page of this testimony. For further  information about this testimony, please contact Anu K. Mittal, Director,  Natural Resources and Environment team, (202) 512-3841 or  mittala@gao.gov. In addition to the individual named above, key  contributors to this testimony were Dan Haas (Assistant Director),   Quindi Franco, Alison O’Neill, Barbara Timmerman, and Lisa Vojta.
section_title: Appendix I: Location of Oil Shale Resources in Colorado and Utah
subsections: section_title: N
paragraphs: This is a work of the U.S. government and is not subject to copyright protection in the  United States. The published product may be reproduced and distributed in its entirety  without further permission from GAO. However, because this work may contain  copyrighted images or other material, permission from the copyright holder may be  necessary if you wish to reproduce this material separately.