Could Estonia lead a shale oil boom?

90 percent of the tiny eastern European country's citizens get their energy from shale oil. And they're ready to export their expertise.

Estonia's new, state-of-the-art Enefit280 oil shale refinery.
(Image credit: AP Photo/Gary Peach)

Estonia— home of the founders of Skype and the (fake) birthplace of Encino Man— hopes to emerge as an industry leader in the production of shale oil.

Shale oil comes from, well, oil shale — a soft brown sedimentary rock rich in the organic chemical compound blend kerogen. When heated, kerogen can produce oil similar to crude, and can be processed into jet fuel, diesel, gasoline, and heating oil. These products may burn cleaner than those from crude oil — even cleaner than super diesel (ultra low sulfur diesel), though environmentalists worry about mining and processing hazards.

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To prepare, Enfit has bought mineral rights to a chunk of land in Utah that may hold as much as 2.6 billion barrels of recoverable shale. So far, the investment has proved challenging. The oil shale mined in Utah and processed in Germany was "stronger and drier" than Estonian oil shale, and did not release the same petroleum bounty Enfit had hoped. Some fear the government could lose as much as $100 million if the plan fails.

If the plan works, however, the country could make billions. And with crude oil prices on the rise overall, the operation could help trigger a boom in Utah shale oil, says the Salt Lake City Tribune.

The potential beyond Utah is immense: The estimate for shale oil reserves worldwide is about 4.8 trillion barrels — four times crude oil reserves.

Carmel Lobello is the business editor at TheWeek.com. Previously, she was an editor at DeathandTaxesMag.com.