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Engineering a Boom

Private Lands in Shale Country

Although it may not always look like it on the surface, today about 20% of Shale Country is owned by private individuals and corporations. When energy companies bought the title to one of the area's original homesteads (one that predated the 1916 split estate law and thus owned the mineral rights to the land), they often provided lease-back agreements that allowed for the land's continued operation as a ranch. During the Depression, when a number of homesteads reverted to federal land because their occupants could not pay the taxes, these lease-back offers must have been especially attractive.

A map showing the mix of public and private land in Shale Country...

Other Western Slope residents - notably Dr. Tell Ertl and John W. Savage Sr - purchased old claims in anticipation of the day when their value would once again rise. In the decades after World War II, Ertl, Savage, and their heirs tracked down the descendents of the original prospectors, fought legal battles with the Department of Interior over the legitimacy of their claims, and diligently proved up and maintained the claims until by 1980 the Ertl family controlled 67% and the Savage family 13% of the individually-owned oil shale lands in the Piceance Basin. Their efforts paid off that year when the US Supreme Court ruled that the government was required to honor oil shale claims originally filed before 1920, clearing the way for the families to lease their property to energy companies willing to pay a premium to join the second oil shale rush.

With these substantial private holdings in Shale Country - more than 200,000 total acres by some counts - Garfield County Commissioner Larry McCown, an oil shale worker during the last boom, thinks that leases on public land might not be necessary for the development of oil shale: "What everybody always seems to forget is that all the major oil shale players the last time around still have sizable private holdings where they could start a project without the BLM."¹⁴

Energy companies and oil shale advocates acknowledge that significant resources are in private hands, but they have consistently maintained that the richest deposits - meaning those that will yield the most oil and be most likely to provide profit margins capable of supporting the high startup costs of a new industry - underlie federal lands.