U.S. govt to propose rules to develop oil shale

WASHINGTON, July 21 (Reuters) - The U.S. Interior Department said on Monday it will propose regulations on Tuesday to establish a commercial oil shale program that could result in up to 800 million barrels of recoverable oil on public lands in western United States.

The White House and many Republicans have called for a ban on oil shale drilling to be lifted to help alleviate record high oil prices.

Congress temporarily blocked oil shale development in the Midwest due to concerns from environmentalists that oil shale production consumes large amounts of water and power, both of which are scarce in the West.

Shale rock is heated with steam to extract the oil.

With oil prices soaring above a record $147 in the past month, Republican lawmakers have called for increased domestic oil production by ending restrictions on drilling offshore and in the Arctic National Wildlife Refuge (ANWR), in addition to oil shale development.

Democrats, however, have pushed for oil companies to drilling on land already available under government leases to search for oil. (Reporting by Ayesha Rascoe; Editing by Marguerita Choy)