There have been reports of a huge energy find in the Australian outback. Some outlets are breathlessly reporting the shale oil reserves around the tiny town of Coober Pedy in the Arckaringa region could be worth $20 trillion.
But there are a few problems with that idea – starting with the basics:
- Shale oil means fracking, which requires vast amounts of water. Billions of gallons.
- At 65,000 square kilometres (16 million acres), this part of the Arckaringa is larger than some countries, but it’s one of the driest parts of the planet, and is in the middle of an historic long-term drought.
- Even if they get the water, a lot of these reserves may not be recoverable.
- Even if they’re recoverable, they may not be economically viable, especially if abundant fracked shale natural gas continues to keep energy prices down.
- They’d need to build 300 kilometers of pipeline at a minimum to get this stuff to market (and we know how much fun getting pipelines approved can be).
- And Australia doesn’t currently have the refineries to process all that oil.
So this is big news… but with lots of big caveats. Reports indicate ‘unrisked prospective resource’’ of up to 133 to 233 billion barrels of oil. But even the company that owns the rights, Linc Energy, is hesitant about that full claim (even though it’s provided a huge boost to their stock price).
This could help Australia move from importing half its oil to becoming energy self sufficient – even if the low end is the case, and there are only 3.5 billion recoverable barrels, that will nearly double Australia’s reserves (currently at 3.9 billion barrels).