From: Platts
The government of Queensland has cleared the way for the development of a commercial oil shale industry in the eastern Australian state.
The government’s new oil shale policy sets rigorous environmental controls on the industry and will allow existing oil shale operator Queensland Energy Resources Limited to progress its trial plant at Gladstone to the commercial stage, Natural Resources and Mines Minister Andrew Cripps said in a statement Wednesday. QER’s pilot plant is designed to operate at around 2.5 mt/hour of oil shale feed, producing 37-40 b/d of shale oil.
“Queensland currently has around 90% of Australia’s known oil shale resources, which are equivalent to approximately 22 billion barrels of oil,” Cripps said. “As the world supply of conventional crude oil diminishes, there are strong prospects for oil shale to become the next major source of liquid fuel supplies in Australia, and Queensland is well placed to lead that charge.”
According to Cripps, Queensland’s new policy would encourage private sector investment in oil shale extraction technologies and ensure project proponents demonstrate that their processes meet high environmental standards and community expectations. It would also continue the existing 20-year moratorium on development of QER’s McFarlane oil shale deposit near Proserpine until 2028.
Queensland Minister for Environment and Heritage Protection Andrew Powell said strict environmental controls would apply to any proposal to mine and process oil shale.
“To date, there has been extremely limited commercial application of oil shale in Australia and overseas,” Powell said. “That’s why any proposed oil shale development will be subject to detailed environmental assessments on a project-by-project basis. We will consider these proposals on their merits and require a trial stage to determine the feasibility and environmental performance of any unproven technologies.”
Under the new policy, existing operator QER, which has already demonstrated the viability of its processing technology, would be able to proceed directly to commercial production, but new entrants to the industry would need to prove their oil shale extraction technologies through trials, Powell said.
“Importantly, both existing and new operators in the oil shale industry will need to prepare full Environmental Impact Statements for their projects,” he added.
QER holds the rights to several large oil shale resources in Queensland, including the Stuart and Rundle deposits where former owner Southern Pacific Petroleum conducted an unsuccessful pilot plant trial which ended in 2004, according to information on its website. The company’s total net oil shale resource base is 15.8 billion barrels of oil in place.
QER plans to build and operate a commercially viable large-scale shale-to-liquids processing plant in Queensland. The company estimates it can extract between 60 and 220 liters of oil from each tonne of rock shale it processes.
Shale oil is a suitable feedstock for Australian oil refineries in the production of diesel and aviation fuels, QER said. The company has commissioned a small-scale oil upgrader at Gladstone to produce ultra-low sulfur diesel and jet fuels, mainly for testing purposes.
QER also has interests in the state’s burgeoning coalseam gas sector.
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