French oil giant, Total, has acquired a 50 percent stake in a
U.S. energy company operating in the West, giving it access to
a federal drilling lease with vast amounts of shale deposits.

Total did not say how much it paid for the stake in American
Shale Oil, a subsidiary of IDT Corp., which has rights to the
prospective shale oil development on the Western Slope.

Shale deposits in Colorado, Wyoming and Utah are believed to
hold more than 1 trillion barrels of oil, with nearly three
quarters of  believed to be recoverable.

American Shale is one of several companies with 10-year leases granted by the U.S. Bureau of Land Management to assess, test and demonstrate the potential for commercial shale oil production in the western part of Colorado.

“Our investment in AMSO furthers our commitment to developing unconventional hydrocarbons,” Yves-Louis Darricarrere, Total’s E&P president said in a statement. “Given the magnitude of oil shale resources we believe that this project has an important long-term potential for global energy markets.”

Total isn’t the only European energy operator becoming involved
with  shale projects in the U.S. Last November, Norwegian
energy company Statoil Hydro bought a one-third interest for
$3.37 billion in Chesapeake Energy’s stake to natural gas
deposits in the massive Marcellus Shale area in Appalachia.

Chesapeake Energy, the largest natural gas producer in the
U.S., also has sold a 25 percent working interest in its assets
in the Fayetteville Shale assets to BP America, a unit of
British oil company BP PLC, for $1.9 billion.

Under the latest deal, Total and IDT will jointly develop a
research and demonstration program to produce and commercialize
shale oil. Total, the world’s fifth largest integrated oil and
gas company, will pay for most of the funding for the research,
development and demonstration phase of the project along with
providing technical assistance. It also will assume management
responsibility during the subsequent commercial phase.

The companies expect the deal to close this quarter.