History of Oil Shale

The History of Oil Shale

Early Years

Because it can be burned without processing, oil shale has been used as a fuel source since prehistoric times. As far back as the 10th century, there are written records of experiments to extract oil from shale rock. Apothecaries and physicians in Austria used oil from shale for medicinal purposes as early as 1350. The first known oil shale extraction patent was granted by the British Crown in 1684 to a group that had “found a way to extract and make great quantities of pitch, tarr, and oyle out of a sort of stone.”

The First Commercial Wave

Commercial production, in which large quantities of shale were mined and heated in specialized ovens called retorts, began in France in the 1830s. Following the French lead and improving upon their methods, Scottish energy entrepreneurs initiated an oil shale industry around Edinburgh in 1850 that successfully operated into the 1960s. During the late 19th century, commercial production of oil shale was found throughout Europe, Estonia, New Zealand, South Africa, Brazil, Australia, and North America.  

The first North American processing facility for oil shale was opened in Alberta, Canada in 1815. While this first facility was small, by the eve of the U.S. Civil War, more than 50 companies in Canada and the United States were retorting shale to distill oil from rocks (albeit none very successfully); most of this oil was used to produce kerosene.

Oil Shale in Early Utah

Ute Indians spoke of “the rock that burns,” indicating that they recognized oil shale’s unique properties. According to Utah’s State Historical Preservation Office, early pioneer settlers in eastern Utah accidentally discovered oil shale after chimneys constructed with the sedimentary rock caught fire and burned the first few cabins built by the pioneers.

Mormon settlers founded the first known oil shale operation in the Rocky Mountains, perhaps as early as 1855, building a retort in a ravine near the small, present-day town of Levan, Utah, about 100 miles south of Salt Lake City.  

20th Century Activities

Liquid crude oil discoveries in the U.S. in the late 19th century and in the Middle East in the mid-20th century brought most oil shale industries to a halt. Vast, easily accessible crude oil drove prices down to the point that most oil shale development became uneconomic.  

Still, in 1944 the U.S. recommenced oil shale extraction as part of its Synthetic Liquid Fuels Program. This program and its related industries continued until 1986 when drastically declining oils prices forced its closure. Because of the dramatic drop in oil prices, in May of 1982 Exxon shuttered the billion-dollar Colony Oil Shale Project, which had produced 270,000 barrels of oil. The last oil shale retort in the U.S., operated by Unocal Corporation, closed in 1991.

Modern Oil Shale Industries

In recent years oil shale extraction has continued in Estonia, Brazil, and China, both for power (by burning the ore like coal) and for liquid production. In 2008, these countries produced about 17,700 barrels of oil from shale per day.  

The U.S. Synthetic Liquid Fuels Program was restarted in 2003, followed by a commercial leasing program in 2005 that permitted the extraction of oil shale and oil sands on federal lands in accordance with the Energy Policy Act of 2005. Since then, six federal demonstration projects have been put under lease by the Bureau of Land Management (BLM). In addition, several private ventures have shown renewed interest in U.S. oil shale production, including Red Leaf Resources.  

In addition to the U.S., Australia and Canada have tested shale oil extraction techniques via demonstration projects and are planning commercial implementation. Morocco and Jordan have announced their intent to do the same.