MNCs amass water rights in US

To produce oil from rocks

OIL companies have amassed rights to large volumes of water in the US state of Colorado to produce oil from shale, fine-grained sedimentary rock that is rich in organic matter. This could have a disastrous impact on the water-scarce area, said a study by a US-based environmental group, Western Resources Advocates.

Oil shale in three US states--Colorado, Utah and Wyoming--hold as much oil as the reservoirs of Saudi Arabia. But extracting oil from shale is expensive and technologically in its infancy despite more than 25 years of research. Oil companies, including Exxon and Shell, are currently carrying out research and development of oil shale technologies in Colorado. As commercial production of each litre of oil from shale would require three to four litres of water, the report said, companies have acquired rights to two billion cubic metre of stored water in the state and the right to divert large amounts of water from the Colorado and the White rivers. The companies have also bought rights to 100 irrigation canals.

Under the Colorado water law, a person holding an older right may use his rights over a stream to obtain full supply. Many of the private water rights are older than those held by regional water suppliers. Hence, the reports said, exercising these rights for commercial development of shale oil would hamper water supply. Patrick McGinn, spokesperson of Exxon, which holds the largest chunk of water rights, said the report overestimates the amount of water needed. The report, however, calls for further study of the economic and environmental impacts.

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