Shell spokesman Terry O'Connor says the challenge is to prove the untried process is reliable and environmentally sustainable.
The company has tested on a small portion of its 20,000-acre Cathedral Bluffs property for the last five years, the Grand Junction Daily Sentinel reported Thursday.
Large electrical heaters gradually heat shale oil-bearing rocks, up to 2,000 feet deep, to between 650 to 700 degrees to produce natural gas and light-grade oil that is pumped to the surface.
"We're still a couple of more test stages away from commercial production," O'Connor said.
Tests have so far produced approximately 2,000 barrels of oil with heaters spaced 10 to 20 feet apart over a five-acre parcel, but a commercial operation will mean more heaters and greater spacing.
Shell estimates its process is economical at oil prices of $25 to $30 a barrel, much less than recent prices in the $50 to $60 range.
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