Potential for Oil Shale Development; Call for Nominations-Oil Shale Research, Development, and Demonstration (R, D, and D) Program, 2611-2612 [E9-525]

Agencies

• DEPARTMENT OF THE INTERIOR
• Bureau of Land Management
• Land Management Bureau

[Federal Register Volume 74, Number 10 (Thursday, January 15, 2009)]
[Notices]
[Pages 2611-2612]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-525]



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DEPARTMENT OF THE INTERIOR

Bureau of Land Management

[LLWO-3200000 L13100000.PP0000 L.X.EM OSHL000.241A]


Potential for Oil Shale Development; Call for Nominations--Oil 
Shale Research, Development, and Demonstration (R, D, and D) Program

AGENCY: Bureau of Land Management (BLM), Interior.

ACTION: Notice.

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SUMMARY: The BLM solicits the nomination of parcels to be leased for R, 
D, and D of oil shale recovery technologies in Colorado, Utah, and 
Wyoming.

DATES: Nominations for oil shale R, D, and D leases can be made January 
15, 2009 through March 2, 2009.

ADDRESSES: Please send nominations to the BLM state director for the 
state in which the parcel you are nominating is located: Sally Wisely, 
State Director, BLM, Colorado State Office, 2850 Youngfield Street, 
Lakewood, Colorado, 80215-7076; Selma Sierra, State Director, BLM, Utah 
State Office, 400 West 200 South, Suite 500, Salt Lake City, Utah, 
84145-0155; and Bob Bennett, State Director, BLM, Wyoming State Office, 
5353 Yellowstone Road, P.O. Box 1828, Cheyenne, Wyoming, 82003.

FOR FURTHER INFORMATION CONTACT: Charlie Beecham, BLM, Colorado State 
Office, 303-239-3773; Jeff McKenzie, BLM, Utah State Office, 801-539-
4038; and Robert Janssen, BLM, Wyoming State Office, 307-775-6206.

SUPPLEMENTARY INFORMATION: On June 9, 2005, the BLM published in the 
Federal Register a notice entitled ``Potential for Oil Shale 
Development; Call for Nominations-Oil Shale Research, Development, and 
Demonstration (R, D, and D) Program'' (70 FR 33753). As a result of 
that notice, the BLM issued six R, D, and D leases. Section 369 of the 
Energy Policy Act of 2005 (EP Act) (42 U.S.C. 15927) addresses oil 
shale development and directs the Secretary of the Interior to make 
public lands available for conducting oil shale research and 
development activities.
    In accordance with the EP Act, the BLM is soliciting for nomination 
parcels to be leased for R, D, and D of oil shale recovery 
technologies. The lease form for this round of R, D, and D leases has 
been revised from the one published in the June 9, 2005 notice (see 70 
FR 33755) to make it consistent with the oil shale regulations 
published on November 18, 2008 (see 73 FR 69414), including changes to 
the provisions on royalty and lease conversion. As discussed below, the 
lease form is also revised by increasing the maximum acreage of the R, 
D, and D lease and by removing the option for additional preference-
right acreage. The revised R, D, and D lease form can be found at: 
https://www.blm.gov/wo/st/en/prog/energy/oilshale_2.html. Please 
contact Nick Douglas at (202) 557-3377 if you have any questions.
    The BLM is soliciting the nomination of parcels, not to exceed 640 
acres, for the conduct of oil shale R, D, and D under a 10-year lease 
agreement. Under the conversion regulations at 43 CFR 3926.10, an R, D, 
and D lease is eligible for conversion to a 20-year lease after 
producing commercial quantities of shale oil from the lease and after 
meeting the other provisions of that section.
    The BLM may issue one or more R, D, and D leases in each of the 
states of Colorado, Utah, and Wyoming based on review of the 
nominations and analysis under the National Environmental Policy Act 
(NEPA). The R, D, and D nominations will be reviewed by an 
interdisciplinary team. The BLM will request the participation of a 
representative of each of the States of Colorado, Utah, and Wyoming, as 
appropriate, and the Departments of Defense and Energy. The review will 
consider the potential of proposals to advance knowledge of effective 
technology, economic viability, and the means of managing the 
environmental effects of oil shale development. The review will also 
consider the potential environmental, social, and economic impacts on 
the site or the region associated with each nomination.
    The interdisciplinary team will rate the nominations based on the 
team's review. Nominations that the interdisciplinary team rates and 
recommends for issuance of an R, D, and D lease will be analyzed under 
NEPA. The NEPA analysis will also document compliance with the National 
Historic Preservation Act, the Endangered Species Act, and any other 
applicable Federal statute. At the conclusion of the NEPA analysis, the 
BLM may issue one or more R, D, and D leases.
    If the BLM receives two or more nominations to lease the same 
lands, the BLM will issue an R, D, and D lease, if at all, to the 
qualified nominator whose proposal is rated highest by the 
interdisciplinary team.
    The time required for NEPA analysis and documentation may differ 
depending on: (1) Whether the application is for a tract that has 
previously been the subject of NEPA analysis for oil shale operations, 
(2) the method of shale oil extraction, and (3) whether the application 
involves mining or in-place shale oil recovery. Accordingly, some R, D, 
and D leases may be awarded prior to others. Each applicant will be 
responsible for the costs of NEPA analysis of its nomination.
    Lease nominations must, at a minimum, contain the following 
information:
    (1) Name, address, and telephone number of the applicant, and the 
name, address, and telephone number of the representative of the 
applicant who will be responsible for conducting the operational 
activities.
    (2) Statement of qualifications to hold a mineral lease under the 
Mineral Leasing Act (MLA). Qualification requirements can be found in 
43 CFR subpart 3902 of the final oil shale regulations (see 73 FR 
69414).
    (3) Description of the lands, not to exceed 640 acres, in 
accordance with 43 CFR 3901.10 of the oil shale regulations, together 
with any rights-of-way required to support the development of the oil 
shale R, D, and D lease.
    (4) A narrative description of the proposed methodology for 
recovering oil from oil shale, including a description of all equipment 
and facilities needed to support the proposed technology.
    (5) A narrative description of the results of laboratory and/or 
field tests of the proposed technology.
    (6) A schedule of operations for the life of the project and 
proposed plan for processing, marketing, and delivering the shale oil 
to the market.
    (7) A map of existing land use authorizations on the nominated 
acreage.
    (8) Estimated shale oil and/or oil shale resources within the 
nominated acreage boundary.
    (9) The method of shale oil storage and the method of spent oil 
shale disposal.
    (10) A description of any interim environmental mitigation and 
reclamation.
    (11) The method of final reclamation and abandonment and associated 
projected costs of final reclamation.
    (12) Proof of investment capacity.
    (13) A description of the commitments of partners, if any.
    (14) A statement from a surety qualified to furnish bonds to the 
United States Government of the bond amount for which the applicant 
qualifies under the surety's underwriting criteria.
    (15) A non-refundable application fee of $4,000.00.

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    The non-refundable application processing fee is increased from 
$2,000 to $4,000 per application based on estimates of costs for 
processing the previous R, D, and D lease applications and a similar 
$4,000 processing fee authorized under the Consolidated Appropriations 
Act of 2008 (Pub. L. 110-161) for oil and gas activities.
    Applications submitted for lands within the multi-mineral leasing 
zone in Colorado must demonstrate the potential capability to extract 
shale oil, dawsonite, and nahcolite or demonstrate a potential 
capability to extract shale oil while preserving the other minerals for 
future recovery.
    An applicant should prominently note and segregate any information 
submitted with the application that contains proprietary information or 
trade secrets, if the disclosure of this information to the public 
would cause commercial or financial injury to the applicant's 
competitive position. The BLM will protect the confidentiality of such 
information to the extent permitted by the Freedom of Information Act 
(FOIA). Any FOIA requests for such information will be handled in 
accordance with the regulations at 43 CFR 2.23.
    The original R, D, and D leases were issued to generate interest in 
and to encourage research and development of oil shale resources on 
Federal lands. As an incentive for performing research and development, 
additional acreage for a preference lease area was made available to 
the original R, D, and D lessees. There was significant interest in 
response to the original R, D, and D lease offerings and this interest 
in research and development of oil shale on Federal lands continues, 
which suggests that incentives for R, D, and D beyond those conferred 
by the R, D, and D lease itself, are not needed. Since offering the 
original R, D, and D leases, and completing an analysis of oil shale 
potential and availability on public lands, the Department has 
determined that an R, D, and D lease of 640 acres is likely to provide 
reserves sufficient to support a commercial operation. For these 
reasons, the revised R, D, and D leases do not provide additional 
preference lease areas over and above the R, D, and D acreage of 640 
acres. The maximum acreage of the revised lease is increased from 160 
acres to 640 acres, which is sufficient to accommodate an R, D, and D 
project based on public comments to the initial Federal Register Notice 
of November 22, 2004 (69 FR 67935). Public comments received at that 
time indicated that a reasonable acreage size for an R, D, and D lease 
ranged from 40 to 640 acres. The BLM believes that 640 acres is 
sufficient acreage to support research and development and also to 
allow for the eventual expansion into commercial operations.
    To encourage the use of new technologies, the BLM will only 
consider applications that demonstrate new technologies not currently 
being tested on the R, D, and D leases issued as a result of the June 
9, 2005, call for nominations. See the FOR FURTHER INFORMATION CONTACT 
section of this Notice if there are questions on technologies currently 
being tested on the existing R, D, and D leases. Applications must 
document field demonstration of the feasibility of the proposed oil 
shale extraction methodology(ies). Entities that currently hold R, D, 
and D leases on BLM public lands are excluded from submitting 
additional applications for leases. The BLM will only accept one 
application per entity.

Henri R. Bisson,
Deputy Director, Operations, Bureau of Land Management.
[FR Doc. E9-525 Filed 1-14-09; 8:45 am]
BILLING CODE 4310-84-P