Federal officials this week cut their estimate of reachable oil reserves in California’s Monterey Shale formation from a massive 13.7 billion barrels to just 600 million, throwing into question the area’s much-touted potential as an economic boon for the cash-strapped state.

New data released on Tuesday by the Energy Information Administration (EIA) reduces the amount of shale oil believed available in all of the United States by 66 percent, the Los Angeles Times reported.

An earlier study commissioned by an oil and gas industry body had estimated that tapping the Monterey formation – a move opposed by many environmentalists – could bring 195,000 jobs to the most populous U.S. state.

But most of the ocean of oil in the Monterey formation is trapped beneath curving rock formations and hard to get at, and the EIA said drilling efforts using today’s technologies will not yield much.

"From the information we've been able to gather, we've not seen evidence that oil extraction in this area is very productive using techniques like fracking," John Staub, a petrochemical analyst with EIA, told the Los Angeles Times. He was referring to hydraulic fracturing, in which water and chemicals are pumped into the ground to loosen gas deposits.

The government’s dramatic revision – which is still subject to future updates – emerged from a new look at the Monterey formation by the U.S. Geological Survey, and from a comparison with more successful shale drilling efforts in North Dakota and Texas.

But the EIA estimate measures “technically recoverable resources,” a term meaning the amount extractable using current technologies. And the agency’s slashing of its estimate appears unlikely to deter the tenacious oil and gas industry from looking for new ways to get more out – even if it takes them a while.

“It’s an estimate of recoverable gas, so they’re not saying the gas isn’t there, only that we can’t access it with current technology,” Hilton Price, an editor with PennEnergy, an oil and gas research publication, told Al Jazeera in an email.

“Much like the drilling improvements of the last decade unlocking unconventional oil and gas here in the U.S., we’ll likely see further advances years from now that help us reach this gas in question.”

The EIA’s new estimate for 2014, which it expects to formally release this summer, does not reflect profitability. In other words, rising oil prices could encourage even more determined attempts to get at the crude lying beneath California’s fertile inland valley.

High oil and gas prices have already encouraged daring, expensive and environmentally controversial forays into shale gas and tar sands crude.

“While technically recoverable resources (TRR) is a useful concept, changes in play-level [geological formations expected to contain oil and gas] TRR estimates do not necessarily have significant implications for projected oil and natural gas production, which are heavily influenced by economic considerations that do not enter into the estimation of TRR,” Jonathan Cogan, an EIA spokesman, told Al Jazeera in an email.

The Western States Petroleum Association (WSPA), an industry organization, sees the EIA announcement as a hurdle but not a deal-breaker.

“We have a lot of confidence in the intelligence and skill of our engineers and geologists to find ways to adapt," Tupper Hull, WSPA spokesman, told the Los Angeles Times.

As representatives of the oil and gas industry maintained that California fossil fuels are still a good bet, environmental groups hailed the EIA finding as good news for the state. Many of these organizations believe oil drilling is not only an imminent risk to water and air, but a source of carbon emissions contributing to climate change.

Damon Nagami, senior attorney with the Natural Resources Defense Council (NRDC), said techniques to access oil in Monterey and other deposits can include harsh and unproven methods – such as using acid to strip away rock that’s in the way of the underground “black gold.”

“We are very concerned about bringing these quantities of highly toxic acid onto sites, using them in the process and not really understanding where it goes or what happens when the product comes back up out of the well,” Nagami told Al Jazeera.

This isn’t the first time that a shale formation has had its yield downgraded, Nagami said, noting that estimates have bounced up and down for the Marcellus shale, a natural gas formation under a huge swath of Pennsylvania, Ohio, West Virginia and New York.

For California, Nagami said that the NRDC would like to see a statewide moratorium on oil and natural gas drilling, and that he hopes one will come from a bill winding its way through the statehouse in Sacramento.

"This new assessment should encourage California legislators to move even faster toward clean energy," Dan Jacobson, Legislative Director with Environment California, told Al Jazeera in an email.

"For those who were expecting California oil would been a economic boom for California, the new data shows that California should instead by promoting clean energy power like wind and solar."

Meanwhile, efforts to get at the oil will continue as the oil and gas industry devises new technologies, Nagami said.

“You can already tell from early industry reaction that they are going to try to make those technical advances happen."