Shale Oil

Content maintained by Leesa Carson

• Shale Oil
• Resources
• Exploration
• Production
• World Ranking
• Industry Developments

Oil shale is organic-rich shale, which yields substantial quantities of oil (normally referred to as shale oil) and combustible gas by heating (retorting) and distillation. The organic material in oil shale is called kerogen, which under appropriate conditions in the crust can be a precursor to conventional oil reservoirs. One t of commercial grade oil shale may yield from about 100 to 200 L of oil.

Oil shales of commercial interest are predominantly in a series of narrow and deep extensional-basins near Gladstone and Mackay in central Qld. These are thick Tertiary lacustrine (lake-formed) deposits, which are relatively easy to mine and process compared to carbonate-rich oil shales (marls) elsewhere in the world. The Permian Galilee and Bowen Basins in Qld contain oil shale associated with coal measures. Oil shales occur in the Cretaceous Toolebuc Formation of the Eromanga Basin in north west Qld. Minor deposits are located in northern Tas (Latrobe tasmanite deposit) and an oil shale - heavy mineral sand deposit in southern WA.

Australia has 4.5 GL (28 million barrels) of shale oil EDR. This could increase significantly if research and development into processing shale oil resulted in the development of a commercial plant. Paramarginal and submarginal demonstrated resources are 208.5 GL (1.3 billion barrels) and 3719 GL (23.4 billion barrels) respectively. All of shale oil EDR is accessible and account for all of JORC Code reserves.

An inferred resource is estimated to amount to 246,115 GL. This figure includes the 'total potential' shale oil resources of the Toolebuc Formation of around 245,000 GL estimated by the Bureau of Mineral Resources (now Geoscience Australia) and the CSIRO in 1983 . The research project undertook detailed geological, petrophysical and geochemical examination of the oil shales of the Toolebuc Formation. The objectives of the project included investigating and developing methods to assist government and industry to assess the potential of sedimentary sequence as a possible future source of oil shale and developing an understanding of geological controls and the distribution of oil shale within the Toolebuc Formation. A resource assessment of around 245,000 GL was based on a productive oil shale covering an area of 484,000 km2 that ranges in thickness from 6.5-7 m, a specific gravity of 1.9 and yields an average 37 L of oil per tonne.

Exploration is predominantly focused near Gladstone and Mackay in central Qld and north west Qld. South east of Devonport in Tas, Boss Energy Ltd is continuing to undertake exploration work to define the resource extent of the Latrobe oil shale deposit. Data relating to shale oil exploration is not available.

There is no oil being extracted from oil shale in Australia. From 2000 to 2004, the Stage 1 demonstration-scale processing plant at the Stuart deposit near Gladstone in central Qld produced more than 1.5 million barrels of oil using a horizontal rotating kiln process (ATP - Alberta Taciuk Process). No oil has been produced since 2004. The facility is currently being dismantled.

The demonstration plant achieved stable production capacity of 6000 t of shale per day and oil yield totalling 4500 barrels per stream day while maintaining product quality and adhering to EPA emissions limits. The oil products from the demonstration plant were Ultra Low Sulphur Naphtha (ULSN) 55% to 60% and Light Fuel Oil (LFO) 40% to 45%. The ULSN, which can be used to make petrol, diesel and jet fuel has a sulphur content of less than 1 ppm. To put this into perspective, from January 1, 2008, the regulated maximum content of sulphur in premium unleaded petrol will be reduced from 150 ppm to 50 ppm.

The 2007 Survey of Energy Resources by the World Energy Council (WEC) reported that total world resources of shale oil are estimated at 2.8 trillion barrels (around 550,000 GL). The largest known deposit is in western USA (2.6 trillion barrels), with other important deposits in the Russian Federation, the Democratic Republic of the Congo, Brazil, Italy, Morocco, Jordon, Australia and Estonia. Only Estonia, China and Brazil produce shale oil. The same WEC survey reported that total oil production for 2005 was 859 ML, with Estonia producing 433 ML, China 226 ML and Brazil at 200 ML.

There is renewed interest in shale oil worldwide. In Australia during the past 12 months there has been interested exploration activity. Currently, four companies are reviewing and testing extraction technologies, these include:

• Blue Ensign Technologies Ltd (Julie Creek Project (south), NW Qld): Thermal solution technology (Rendall Process), involving thermal conversion and hydrogenation followed by supercritical solvent extraction.
• Xtract Energy Plc (Julie Creek Project (north), NW Qld): Xtract technology, using hydrogen and supercritical solvent extraction process.
• Greenvale Mining NL (Alpha project, Qld): Surface processing involving microwave technology, which uses specific frequencies of microwave radiation to extract hydrocarbons.
• Queensland Energy Resources Ltd (Stuart Project, Qld): Paraho vertical shaft kiln processing system.

Ozimic, S. and Saxby, J.D., 1983. Oil Shale Methodology: An examination of the Toolebuc Formation and the laterally contiguous time equivalent units, Eromanga and Carpentaria Basins. Bureau of Mineral Resources and CSIRO research project.