Queensland (Australia) Premier Anna Bligh has placed a 20-year moratorium on the development of oil shale in the state. The announcement immediately blocks the further development of a planned demonstration plant over the McFarlane oil shale deposit in the Whitsunday region. Bligh said she would not allow the environment to be put at risk while the technology for extraction of the resource was still not proven.
Currently only one lease exists to mine oil shale, in Gladstone. The Australian state will permit no new oil shale mines, and the state government will begin a two-year review to determine if oil shale deposits can be used in an environmentally acceptable way. The Premier said the decision was effective immediately and would be legislated in the coming months.
Our environment must come first. That’s why we are putting a 20-year moratorium on all mining activities, bulk sampling and exploration over the McFarlane deposit in the Whitsunday region. This stops immediate plans to dig up approximately 400,000 tonnes of rock for resource testing from this world famous landscape.
While the development of shale oil has potential as an energy source we will not allow it until we can be assured that it can be extracted and processed without harming the environment. This is particularly the case for the McFarlane deposit—15 kilometers south of Proserpine—which is located right on the gateway to the Great Barrier Reef.—Premier Anna Bligh
The 400,000-tonne project now blocked was part of an assessment by Queensland Energy Resources (QER) of the commercial viability of a proposed demonstration plant at McFarlane. QER also owns the Stuart shale oil processing plant at Gladstone, which it decided to decommission in 2004 after acquiring the site from Southern Pacific Petroleum.
Earlier in August, QER announced its selection of Paraho II technology to develop its shale oil deposits rather than the older Alberta-Taciuk Processor (ATP) used in the Stuart demonstration plant. QER had decided the ATP could not be scaled up sufficiently, whereas it believes the Paraho II technology can be.
The Paraho Oil Shale Project was a privately financed program launched in the 1970s in the US to prove the Paraho retorting process and hardware on oil shale at Anvil Points, Colorado.
Oil shale refers to sedimentary rocks that contain solid combustible organic matter called kerogen. Under a heating process, the kerogen can be decomposed to release hydrocarbons that can be captured to produce synthetic crude oil and combustible gas. Queensland has approximately 90% of Australia’s known shale oil reserves and the vast bulk are located between Bundaberg and Proserpine. Australia has shale oil reserves in Queensland estimated as high as 30 billion barrels.
Minister for Mines and Energy Geoff Wilson, said small-scale demonstration plants using shale oil from the Stuart resource at Gladstone would still be allowed but only if companies can gain licences and prove their technology passes the strictest environmental standards.
There are existing mining tenures over the Gladstone shale deposit already and those rights will remain in effect. The owner of the lease at Gladstone is currently examining the commercial viability of a demonstration plant using new shale oil processing technology.
Over the next 2 years, the government will review the technology and if it stacks up economically, technologically and environmentally we will work with industry to see if it could have a broader application further down the track. If the objectives of commercial feasibility and environmental acceptance can be met Queensland could eventually become a major producer of non-conventional oil to help meet national and international demand.—Geoff Wilson