RAND: US Shale Oil Reserves Three Times Larger Than Saudi Arabia

From American Solutions:

The most startling Congressional prohibition on domestic oil production concerns the recently enacted ban on the development of oil shale resources in parts of Colorado, Utah, and Wyoming in the Green River Formation. According to a Rand Study estimate, this reserve contains over one trillion barrels of oil, with 800 billion barrels fully recoverable, or three times the current oil reserves as Saudi Arabia:

The largest known oil shale deposits in the world are in the Green River Formation, which covers portions of Colorado, Utah, and Wyoming. Estimates of the oil resource in place within the Green River Formation range from 1.5 to 1.8 trillion barrels. Not all resources in place are recoverable. For potentially recoverable oil shale resources, we roughly derive an upper bound of 1.1 trillion barrels of oil and a lower bound of about 500 billion barrels. For policy planning purposes, it is enough to know that any amount in this range is very high. For example, the midpoint in our estimate range, 800 billion barrels, is more than triple the proven oil reserves of Saudi Arabia.

Present U.S. demand for petroleum products is about 20 million barrels per day. If oil shale could be used to meet a quarter of that demand, 800 billion barrels of recoverable resources would last for more than 400 years.

(James T. Bartis, et. al., "Oil Shale Development in the United States: Prospects and Policy Issues" (Santa Monica: RAND Corporation, 2005), p. ix. http://rand.org/pubs/monographs/2005/RAND_MG414.pdf) (emphasis added)

The same RAND study indicated that technology exists today that would allow oil shale extraction and that the process would be cost effective once the price of a barrel of oil was $95 (p. x). The price of a barrel of oil today is around $130. However, Shell Oil has been investing in technology that would make extraction much cheaper than standard pit mining:

Shell Oil Company has successfully conducted small-scale field tests of an insitu process based on slow underground heating via thermal conduction. Larger scale operations are required to establish technical viability, especially with regard to avoiding adverse impacts on groundwater quality. Shell anticipates that, in contrast to the cost estimates for mining and surface retorting, the petroleum products produced by their thermally conductive in-situ method will be competitive at crude oil prices in the mid-$20s per barrel.

(James T. Bartis, et. al., "Oil Shale Development in the United States: Prospects and Policy Issues" (Santa Monica: RAND Corporation, 2005), p. x. http://rand.org/pubs/monographs/2005/RAND_MG414.pdf)

In short, if the Congress removed its prohibition, America could develop a substantial amount of its oil needs from domestic oil shale resources rather than relying on foreign governments.