After flagging for decades in the wake of the 1859 Drake oil strike and the subsequent development of an American petroleum industry, attention to Western oil shale resources revived as World War I engulfed Europe. The US Navy was in the midst of converting from coal- to oil-burning ships and needed a secure supply of oil in case of war or national emergency. The search for this new reliable fuel source prompted the US Geological Survey to explore the Western Slope shale deposits beginning in 1913. In 1916 President Woodrow Wilson withdrew from the public domain 45,444 acres divided between two sites in Colorado and 86,584 acres across the border in Utah for designation as Naval Oil Shale Reserves. (These sites joined already-established strategic oil reserves at Elk Hills in California and Teapot Dome in Wyoming, and were augmented in 1924 by President Coolidge with 23,000 acres in Colorado and 4880 acres in Utah).
As the US geared up for its entry into World War I, officials were optimistic about the development of shale. In his 1917 annual report, Secretary of the Interior Franklin K. Lane reported that "it is now possible to work selected deposits of shale in [economic] competition with the oil from oil wells, and that these oil-shale reserves can be considered of immediate importance to the oil industry and to the defense of the nation."6
Federal optimism was broadcast and amplified by effusive articles that appeared in influential popular publications like National Geographic and the Saturday Evening Post, in which excited authors extolled the promise of "billions of barrels of oil locked up in rocks" on the Western Slope.7
Interest and optimism from the federal government triggered the first oil shale boom on the Western Slope. Between 1916 and 1920, a stampede of speculators and prospectors claimed nearly every cliff outcrop in the region - sometimes twice - under the inadequate auspices of the Petroleum Placer Act of 1897, a law that extended the basic principles of the 1872 Hardrock Mining Law to oil development.
Designed to encourage Western settlement, these laws assumed that mining was the most valuable use to which land could be put and made all public lands open to mineral entry, thus establishing a "right to mine" above all other uses of the land. When valuable mineral deposits were discovered, the laws gave claimholders the right to patent the land (that is, to own the property outright by obtaining fee simple title) for $5 an acre. However, the laws were written to govern minerals found in placer deposits (among the gravel of a streambed) and clearly defined lodes (veins running through rock). Gold, silver, and other minerals that sparked 19th-century mining booms could be relied upon to present themselves in one of these two ways, but Western oil shale did not clearly conform to either type of deposit considered in these pieces of legislation.
Without an adequate legal mechanism for governing oil shale, the government found itself with very little ability to regulate mining methods or much of anything else as "oil fever" took hold on the Western Slope
Lacking a law designed to fit their unique situation, oil shale prospectors were forced to shoehorn the existing laws to fit around their claims. Inviting prospectors to stretch the law during a mineral boom is a sure way of asking for trouble, and the government's early attempts to apply these inadequate mining laws to oil shale discoveries provided ample opportunity for claim jumping, coattail speculation (letting someone else do all the work to locate a deposit and then filing claims as nearby as possible, if not simply jumping the claim), dummy locations (making a claim with the intent of turning it over to someone else, such as an employer who wants larger holdings than the law will allow), shady stock deals, and other boomtime shenanigans. A new approach to regulating oil shale was clearly needed.8