Could the Utah petroleum industry once again embrace synfuels?

Synfuels, short for synthetic fuels, was the somewhat misleading name given to tar sands and shale oil, those difficult-to-extract hydrocarbons that were once thought by their boosters to be the answer to the energy crisis of the 1970s.Among the true believers, for a time, was the administration of President Jimmy Carter, which went so far as to create the $20 billion Synthetic Fuels Corp., a quasi-governmental agency launched in 1978. Its most visible project was the shale oil operation at Parachute Creek, Colo., which operated for several years until its government subsidies were withdrawn.

In retrospect, government funding was the only thing that kept synfuels going at all. When the funding stopped, synfuels became as obsolete as bell bottoms and peace symbols.

The status of synfuels today? "It's dead, that's what it is," was the shoot-from-the-hip reaction of one industry expert who, after deciding that characterization might offend someone, asked that he not be named.

Jeff Burks, director of the Utah Office of Energy and Resource Planning, was more circumspect in his assessment of synfuels' prospects in Utah (or anywhere else, for that matter) but the bottom line comes out the same:

"Shale oil and tar sands are not viable alternatives to crude oil at this time," said Burks.

At this time? Does that mean they might be in the future? Only if the future includes crude oil at $35 to $60 per barrel, said Burks. That would mean price hikes of nearly double to triple the price (about $20) that, but for occasional spikes, has held fairly steady for much of the past 20 years.

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"I haven't heard shale oil and tar sands discussed for a long time," said Burks, "certainly no credible discussion. I recall there was a great deal of hype back in the '70s and early '80s that they could be viable, but this was when some people were saying the price of crude would go beyond $50 or $60 a barrel, even $100."

Once it became clear that wasn't going to happen, the end came fairly quickly, said Burks. By 1984, funding for the Synthetic Fuels Corp. was rescinded, and it was shut down.

As for the future, most forecasts suggest the price of oil should remain as flat as it has been for the past two decades.

"The world's oil reserves are actually in a stronger position now than they have been in quite some time," said Burks. "That doesn't bode well for synthetic fuels."

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