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Show OPEC oil price increase closes gap for oil shale i ucKed beneath the peaks and buttes of western Colorado and eastern Utah li.s enough oil to keep the United States r. iling along at its current gas-guzzling rate for another 500 years. That's not new. The Indians knew all about "the rock that burns" and the .ay has been sitting on a major un-i. un-i. ppcd reserved of shale oil in the area for half a century, waiting for the fuel's t: le to come. What's new is that shale oil production may be almost commercially com-mercially feasible, thanks to OPEC oil ir i nisters and their $20-a-barrel price (, ;s. Almost is the key word, says Bob Ovkston. mining manager for Tosco V'cvelopnient Corp. The costs of extracting ex-tracting oil sandwiched into shale a rock made of compacted clay, mud or ':'' - are staggering. " I'ectinically. it's feasible now," he said. "but economically, it's i" -rginal." Another five years, though, a .a shale oil-gasoline could well be -IV .-.Liable at the corner service station. Vid the federal government is trying lo make that a reality. n Tuesday of last week the House ap; roved a measure to provide a mulit:bi!!;on dollar package of federal ''::si,iies to get the nation's infant v ".;hetc fuels industry off the ground. Tt-.e vote was 368-25. The bill, which still needs Senate .'ion. would authorize the government to pay up to $3 billion in price supports :': fuel made from coal, shale or other s.:'-sta;'res. "ot.ee is the country's second-largest e..: epee.eler.t oil producer, one of about six oil firms involved in shale oil re-earch. Along with Atlantic-Richfield es par: of Colony Development Corp.. i.-seo has developed the first complete set ot plans for a commercial plant. For a plant that could produce 50,000 barrels a day, construction costs are estimated at up to $1.25 billion. Current technology might allow the shale oil to be mined, crushed, extracted and made ready for refining for maybe $7.50 a barrel. But Cookston estimated the interest costs on a billion-dollar loan would at least double that price. Add to that a fair return for investors, he said, and "you're looking at a $20 barrel." Union Oil is expected to begin soon producing shale oil on an experimental basis in Colorado at $23 a barrel including in-cluding a $3-a-barrel federal tax credit. Government and private geologists have estimated there are some 600 billion barrels of crude oil squeezed into the West's mountains, enough to keep the United States in fuel for 500 years. Colorado, with a third of the country's coun-try's 1.800 billion barrels of shale oil, has the largest U.S. deposits, followed by Utah and much-lesser deposits in Wyoming. Russia probably has the biggest supply, Cookston said. The oil can be extracted in two ways: above ground, by heating the crushed rock until the oil vapor is released, and "in situ" in place by blasting the rock in huge underground caverns and heating it here, letting the oil collect beneath so it can be pumped out. Either way, it's expensive, and it's unlikely any shale oil will be produced without federal government help, Cookston said. Proposals for a $3-a-barrel tax break or a loan guarantee are before Congress. Environmentalists have questioned the impact of shale oil on the ruggedly beautiful terrain of the West. "But I guess one of the few sure things here is that we need that oil," Cookston said |