Peak Oil continues to haunt us...

[MadImmortalMan]

Trillions of dollars worth of oil found in the the Outback.

Trillions of dollars worth of oil found in Australian outback


Up to 233 billion barrels of oil has been discovered in the Australian outback that could be worth trillions of dollars, in a find that could turn the region into a new Saudi Arabia.


The discovery in central Australia was reported by Linc Energy to the stock exchange and was based on two consultants reports, though it is not yet known how commercially viable it will be to access the oil.

The reports estimated the company's 16 million acres of land in the Arckaringa Basin in South Australia contain between 133 billion and 233 billion barrels of shale oil trapped in the region's rocks.

It is likely however that just 3.5 billion barrels, worth almost $359 billion (£227 billion) at today's oil price, will be able to be recovered.

The find was likened to the Bakken and Eagle Ford shale oil projects in the US, which have resulted in massive outflows and have led to predictions that the US could overtake Saudi Arabia as the world's largest oil producer as soon as this year.

Peter Bond, Linc Energy's chief executive, said the find could transform the world's oil industry but noted that it would cost about £200 million to enable production in the area.



Shale oil is more costly to extract than conventional crude oil and involves the controversial process of hydraulic fracturing, commonly known as fracking.

This involves introducing cracks in rock formations by forcing through a mixture of water, sand at chemicals at high pressure.

"If you took the 233 billion, well, you're talking Saudi Arabia numbers," Mr Bond told ABC News.

"It is massive, it is just huge If the Arckaringa plays out the way we hope it will, and the way our independent reports have shown, it's one of the key prospective territories in the world at the moment.

"If you stress test it right down and you only took the very sweetest spots in the absolute known areas and you do nothing else, it is about 3.5 billion [barrels] and that's sort of worse-case scenario."

Australia is currently believed to have reserves of about 3.9 billion barrels of crude oil - about 0.2 per cent of the world's total - and produces about 180 million barrels a year.

The latest find, at the lowest estimate, would make Australia a net oil exporter; at the higher estimate, Australia would become one of the world's biggest oil exporters.

Tom Koutsantonis, South Australia's mining minister, said the reserves were deep and remote and it was too early to confirm whether they can be profitably tapped.

"All these things are luck and risk," he said.

"What we're seeing up there is a very, very big deposit If the reserves and the pressure was right over millions of years and the rocks have done the things they think they've done, they think they can extract vast reserves of oil out of South Australia which would have a value of about $AUS20 trillion. (£13 trillion)"

The consultants reports, based on drilling and geological and seismic surveys, did not indicate how easily the oil can be tapped or profitably produced.

John Young, a resources analyst at investment group Wilson HTM, said the reserves were "massive" but the actual volumes that may emerge remained uncertain.

"The numbers are going to be very large, but we really need to move from that [to] the quality of the resource - how good is it, how economic will it be, and that's going to take a significant amount of exploration and appraisal work before the industry's in a position to determine that," he said.

South Australia recently had a setback when BHP Billiton announced it was shelving a £20 billion plan to build the world's biggest open-cut mine at Olympic Dam, which has the biggest known uranium deposit and the fourth biggest copper and gold deposits.

As Mr Koutsantonis, the state's mining minister, said of the latest find: "Whether it's economic to recover or not is still the question South Australia is blessed with abundant resources but there are a few setbacks and those setbacks are that they're remote and they're deep."

If it came to it, I think I'd prefer looking for work in the Outback to, say North Dakota or Alberta. Just for the hell of it.

[crazy canuck]

Soon oil will be as cheap as bottled water. 

[Valmy]

I am glad so much oil is being found in the good guy countries.

[mongers]

Soon oil will be as cheap as bottled water. 

But what's the cost ?

[Sheilbh]

I am glad so much oil is being found in the good guy countries.

Well. Australia.

[Admiral Yi]

But what's the cost ?

Peter Bond, Linc Energy's chief executive, said the find could transform the world's oil industry but noted that it would cost about £200 million to enable production in the area.

[CountDeMoney]

Soon oil will be as cheap as bottled water. 

But what's the cost ?

I don't mind ripping up shitty little countries filled with shitty little people and sucking their strategic reserves dry, but there should be more taken into consideration before ripping up nice countries like the West's for it.

People's faucet water igniting and shit, for fuck's sake.

[Valmy]

I am glad so much oil is being found in the good guy countries.

Well. Australia.

A nation entirely populated by criminals is still preferable to the Saudis.

[Richard Hakluyt]

My understanding is that the exploitation of shale oil requires lots of water. Australia is short of that so I'm doubtful that the news is of much importance 

[jimmy olsen]

My understanding is that the exploitation of shale oil requires lots of water. Australia is short of that so I'm doubtful that the news is of much importance 

Yeah, that was my first thought. Where are they gonna get the water to do this?

[Josquius]

Can't sea water be used?

[MadImmortalMan]

Can't sea water be used?

I think it might be prohibitive if the drilling is not near the sea, even if sea water could be used (I don't know if it can, actually).

[Phillip V]

Sea water can be used for fracking.

http://www.total.com/en/special-reports/shale-gas/environmental-challenges-201958.html

[Sheilbh]

But Australia's massive. It's just a bit bigger than the continental US and lots of it's a massive desert, or on fire. Depending on where this find is getting sufficient sea water there will be a massive, and very expensive, business.

[Camerus]

Looks like the next Chinese passport map's going to include Australia as its territory.