Coal stockpile at the Bowie Mine #2, Delta County, Colorado, June 2004. Photo credit: Chris Carroll for the CGS.

Non-renewable Energy

Colorado has a long history of non-renewable energy production from coal to petroleum and natural gas to coalbed methane and oil shale. Current detailed statistics may be found at the Colorado Energy Overview as compiled by the US Energy Information Administration.

Coal extraction has a long and complex history in Colorado. It has been mined commercially in the state since 1864 when it was used for local residential heating. Smaller amounts of coal were mined as far back as 1859 when a local landowner excavated coal from his property and sold it to homesteaders for heating fuel. Coal production expanded in the 1860s-70s, as a result of the demands associated with the Colorado Gold Rush. Later, around the turn of the 20th Century, it was employed for brick and steel production. Most coal currently mined in Colorado is for power generation.

The estimated value of Colorado coal production in 2015 is $675 million and decreased to $602 million in 2019. In 2020, the estimated value of Colorado coal production is $441 million. The overall decreasing trend in coal production is due primarily to the nationwide increased use of natural gas and renewable energy. In 2020, Colorado was the thirteenth largest coal producing state in the U.S. Coal from the state is mostly bituminous and sub-bituminous—with both underground and surface mines currently in operation on the Western Slope—and is characterized by its high heat, low sulfur, low to medium ash, and low mercury content.

Coalbed methane (CBM) is natural gas produced from subsurface coal deposits. Much of the technology uses standard well-drilling and production techniques. The primary difference is the total usage of water in the process. In most cases, water must be pumped out of the formation in order to allow the methane that is adsorbed onto the coal particles to escape and travel to the surface via extraction wells.

Typical natural gas wells reach a peak and then begin a volumetric decline in production relatively rapidly. Coalbed methane wells behave differently. They increase in production for a long time as more and more water is removed from the strata. Decline in production does not usually begin until late in the life of the well.

CBM production in Colorado reached its highest levels, 59%, of total natural gas production during 1998 and has continuously declined to ~11% of the total natural gas production in 2020. This decline is largely due to the increase of natural gas production of unconventional reservoirs by the utilization of horizontal drilling and hydraulic fracturing techniques. As of 2017, Colorado contained about 27% of U.S. CBM reserves.

Oil forms from kerogen, a mixture of organic compounds in sedimentary rocks. It is most abundant in shales. Shales are analyzed and characterized as potential “source rocks” for oil based largely on their TOC (total organic content).

Colorado has the world’s largest resources of oil shale, by far. More than half of the world’s known oil shale resources are located in the Eocene-age Green River Formation which is located in Colorado, Utah, and Wyoming. The Piceance Basin in western Colorado contains an estimated 1.525 trillion barrels of oil (USGS, 2012). Although Colorado contains a large amount of oil shale with potential hydrocarbon resources, it is currently difficult to produce oil from these rocks. Oil shale is different than “shale oil.” Shale oil (and gas) occurs in rocks where the oil is as a liquid between sediment grains. On the other hand, oil shale does not contain liquid petroleum and is actually the rock marlstone which contains kerogen, a precursor to oil. The kerogen must be heated to more than 750 degrees to convert it into a petroleum liquid because it was never buried deeply enough for nature to convert the kerogen to a liquid.

People have been trying to economically produce oil from this rock for more than a century. Indeed, the CGS issued a report in 1921 entitled, Oil Shales of Colorado. Thus far, despite another significant burst of activity in the 1980s, technological and economic conditions have not combined to support a sustained oil shale industry in the state.