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DEPLETION OF SURFACE WA'rER SUPPLIES 21 would be produced at the refineries and this could be used for domestic o purposes as well. :J Coke,.sulphur, and anhydrous liquid ammonia would be the prm- W cipal byproducts resulting from partial refining of shale oil. The ... Nationa~ Petroleum Council, after very thorough study, estimated ... that almost 24,000 tons of coke, more than 800 tons of sulphur, and f~ between 1,500 and 2,000 tons of anhydrous liquid ammonia would be produced in the processing of 1 million barrels of shale oil. Costs oj d,evelopment It is claimed by those most concerned with the development of the oil.shale reserves that the cost of producing gasoline, diesel oil, and other products from oil shale and delivering these .at points of distri- bution in California would be very little more than present costs of producing' the same products from crude petroleum. It is claimed further, and the contention seems to be borne out by available data, that the cost of gasoline made from crude oil obtained from new fields is actually more than the cost which would be incurred in the mining and refiniIlg of oil shale. The natural question is: If such be the case, why has shale oil not yet been produced commercially? The answer lies in the tremendous capital investment required to constmct plants of the capacity necessary for economical operation. In the development of natural petroleum resources large capital investments are made per barrel of finished product, but such invest- ments can 'be made progressively. The output from one well can be hauled to an existing refinery in tank trucks. As additional wells are drilled and' the output becomes too great for this type of transporta- tion, then a pipeline can be built. Finally, when the development becomes large enough to warrant construction of a new refinery, then this can be 'done. In the case of oil shale, howe'ver, no greater total iEcstment would be required ,but development in successive stages would not be prac- ticable. Tlie minimum economic unit of shale oil production is evidently a~out 50,000 barrels per day, and the cost of the required facilities would be about $300 million. It is apparent that no one oil company is going to commit itself to such an expenditure so long as it can obtain crude petroleum at a reasonable price, even if this involves imports from foreign sources. It may be that several oil companies w'ould band together and make the required initial capital investment, and it is not unlikely that the Department of Defense might subsiqize such a development in the interests of national security. Whenever the first commercial plant be built and the economic value of it be demonstrated, the rate of production of shale oil then will be limited only by the market for the resulting products. The production of 1 million barrels of shale oil pel' day is well within the range of probability and twice that rate of production can be visualized without straining the imagination. '.: " , " ~-, . 1.' .,', ~~' }~ -, ~~ OTHER INDUSTRIES It is inevitable that other industries will follow any commercial shale oil development without much delay. The principal motivating factors will be:abundant cheap fuel for power and byproducts usable economically by the chemical and related industries. I