Oil companies have gained control over billions of gallons of water from rivers in the western U.S. in preparation for future efforts to extract oil from shale deposits under the Rocky Mountains, according to a new report by an environmental group that opposes such projects. The group, Western Resource Advocates, used U.S. public records to conclude that energy companies are collectively entitled to divert more than 6.5 billion gallons of water a day during peak river flows. The companies also hold rights to store, in dozens of reservoirs, 1.7 million acre feet of water, enough to supply metro Denver for six years. Industry representatives said they have substantial holdings of water rights for future use in producing oil from shale, though they couldn't confirm the precise numbers in the report. Before any move into full-scale oil shale production, the U.S. energy industry plans a close study of water issues, including the impact its operations would have on ranchers, farmers and communities that all rely on the same limited sources of water, said Richard Ranger, a senior policy adviser for the American Petroleum Institute. "It's among the most important questions to be examined," he said. Bitter fights over water are a recurring feature of life in the arid West, from Colorado to California, and energy companies are just the latest in a long list of users vying for the resource. Extracting oil from shale is still an experimental process, facing major technological, environmental and regulatory hurdles, and is considerably more expensive than conventional drilling. But if the price of oil rebounds, the potential payoff is big: The U.S. government estimates that 800 billion barrels of oil, triple the known reserves of Saudi Arabia, lie under the Rocky Mountain West. For now, the energy companies aren't using most of the water they have claimed. They are leasing some of it to other users, most often farmers. But they are stocking up on water rights to be sure they won't be caught short. "We're picking up properties as they become available or look strategic," said Tracy Boyd, a spokesman for Royal Dutch Shell PLC. Shell doesn't expect to need large quantities of water for at least 15 years, he said, and by then it may have developed less water-intensive ways to extract oil, perhaps using wind power. Exxon Mobil Corp., too, said new technologies might reduce future water needs. "We continue to be a careful steward of this precious resource and a considerate neighbor in dry years," said Patrick McGinn, a spokesman. The Colorado River basin provides water to 30 million people from California to Wyoming, and irrigates 15% of crops in the U.S. Across the West, legions of lawyers and lobbyists fight to extract