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With all the talk that global oil production has reached its peak, and will only slowly decline from here, you may be surprised to learn that there is a vast untapped reserve that could possibly yield 1.4 trillion barrels of oil, enough to supply the daily oil needs of the United States for 191 years.

And where is this incredible reserve --The Middle East, Russia or Brazil? None of the above. It’s right here in the U.S. Specifically, in the great open spaces of Colorado’s Piceance Basin and the Uintah Basin in Utah.

So why isn't the U.S. tapping this liquid gold and ending the country's reliance on foreign sources of oil, regional instability and governments unfriendly to America? Well, as with many things, there’s a catch. It isn’t exactly oil. Well, not yet. Which brings us to a little history.

In the Cretaceous Period, roughly 100 million years ago, the vast Western Interior Sea covered much of western Colorado and eastern Utah. In the same way oil deposits were created elsewhere in the world, lots and lots of animals, fish, plankton, etc. died and settled on the sea bottom. Eventually, they turned to organic-rich shale rock. And the remnants of that organic material remain in the rock today, as a compound called kerogen – the building blocks of oil.

“I like to call it ‘teenage’ oil,'” says Glen Vawter, the director of the National Oil Shale Association. “If it had been buried for maybe a few more million years, it would have been petroleum.”

And therein lies the challenge. How to speed up nature and turn the kerogen into oil. The best way to do it is to heat the rock – to as much as 900 degrees Fahrenheit – which drives off the hydrocarbons as a gas. Condense the gas, and it becomes oil. Refine the oil and it becomes diesel, jet fuel, even gasoline.

It sounds simple enough, right? Well, let’s take another look at history.

The government and oil industry have known about “oil shale” for more than 100 years. In fact, vast tracts of land were set aside in the early 20th century as the Naval Petroleum Reserve. It was to be the source of fuel for the U.S. Navy during wartime. Like gold prospectors, hundreds of oil shale entrepreneurs staked claims through Colorado’s Piceance Basin, where the oil shale came up out of the ground as the Rocky Mountains were formed. They set up furnaces to convert the shale to oil and the word went out about a new western oil boom.

But the boom went bust when no one could produce significant quantities of oil economically, not when there was still plenty elsewhere that just bubbled up from the ground. So prospectors and companies pulled out and the nascent oil shale industry went dormant.

In the 1970s, as the price of oil soared in the wake of the Arab oil embargo, oil shale again looked like a shining beacon of energy independence. Exxon invested hundreds of millions of dollars in mines and plants to produce commercial quantities of crude. It hired thousands of locals to work in the industry. Boom times were back.

But in 1982, the price of oil plunged. And in what is still known as Black Sunday, Exxon pulled out – literally overnight – putting 2,000 people out of work. The boom had again gone bust.

“Oil shale is the fools’ gold of the petroleum industry,” says Randy Udall, an energy expert and son of politician Mo Udall. “We’ve been trying to do this for 100 years and everyone who has tried to produce oil shale has lost their shirt and broken their pick.”

Udall is one of many people who believe oil shale will never pay off. “Oil shale is kind of a mirage on the highway,” he says. “As you approach it, it recedes further and further away from you. I compare it to pulling the sword from the stone.”

If oil shale is Excalibur, there are still plenty of people trying to become the industry's King Arthur. In Utah, EnShale has developed new technology to more efficiently extract oil from the shale by heating it on the surface. Crushed rock goes in one end – light crude comes out the other. The company has plans on the table for a commercial facility it claims could produce 15,000 barrels a day. Eesti Energia of Estonia (where oil shale is fueling power plants) is moving into Utah to develop its version of surface conversion -- “retorting.” And Red Leaf Resources is experimenting with new surface technology that converts shale to oil with minimal environmental impact.

Big companies like Shell, Exxon, Chevron and American Shale Oil are taking a different tack. They are trying to convert the oil 'in situ' – where it is – underground. They’re spending tens of millions of dollars on research to heat the rock 1,000 feet deep and release the oil so it can be pumped to the surface with a conventional well. The technology is incredibly complex. Shell has even been experimenting with a 'freeze wall’ – basically a vertical ice rink – that keeps ground water out of the oil producing area – and vice versa.

The companies say they have ‘proof of concept’ that in situ oil shale conversion is possible. Now the trick is to make it commercially viable.

And that’s where they run headlong into environmental concerns. A Rand Corporation study found that producing oil shale will take an enormous amount of water. And in Colorado and Utah, there is barely enough to go around as it is. The study also found that converting 100,000 barrels of oil from shale underground every day would take enough power to light a million homes, and that upping production to 1 million barrels a day would require the construction of 10 new 1200mw power plants.

Environmental groups argue that given the failed promise of oil shale so far, it’s just not worth it to try again.

But with oil hovering between $90 and $100 per barrel, gas near $4 per gallon and the Obama administration taking the drastic step of releasing 30 million barrels of oil from the Strategic Petroleum Reserve to shore up a wobbling economic recovery, oil shale proponents argue that we can’t afford not to develop this resource. They claim the revenues could run into the trillions of dollars and thousands of jobs would be created.

The battle over oil shale has now landed in the halls of Congress. The Bush Administration had come out with a plan to develop oil shale leases on federal land, which includes much of the Piceance Basin. But after it was sued by environmental groups, the Obama White House put those plans on hold and has ordered a review. That prompted Wyoming Senator John Barrasso (R-WY) to recently introduce a bill that would put it back on the fast track. The American Energy And Western Jobs Act is now before the Senate committee on Energy and Natural Resources.

Glen Vawter has spent 40 years chasing the promise of oil shale. Can it be done this time? “I hope it can,” he says. “And you know, I believe it might be, because we have this new technology.”

The old joke around western Colorado goes like this: Oil shale is the fuel of the future…..and always will be.

Now consider this: Estonia is developing oil shale. So is Brazil. China, too. The U.S. has far more than any of those countries.

What do you think America should do? Comment below.