Are there really huge oil reserves in Queensland’s Taloom Trough? Here’s why skepticism is justified

As Australia’s leaders scramble to secure fuel supplies on international markets, Queensland Premier David Crisafulli quickly floated a domestic option to begin mining a “sea of ​​oil” in the Taloom Trough, a geological formation near the town of Roma.

The state government strongly supports mining as a way to enhance fuel security. Federal Environment Minister Murray Watt has reportedly asked Queensland to provide details “without delay”.

It seems like common sense to extract domestic oil to reduce dependence on oil imports. But it’s natural to be skeptical. The exploration has just begun. Many challenges need to be overcome. Extracting the oil requires hydraulic fracturing, a controversial technology that poses clear harm to human health.

From self-sufficiency to import dependence

In 2000, Australia produced and refined more than 560,000 barrels of domestic oil per day, meeting 98% of its demand. Twenty-six years later, most of Australia’s refineries have closed and the country’s major oil fields are running dry. The country produces only 5.6% of the crude oil it consumes every day.

Australia currently imports about 90 per cent of its fuel needs either as refined fuel or as crude oil for its two remaining refineries to turn into petrol, diesel and other fuels. Last year, this cost more than A$51 billion.

Why now?

The Taloom Trough is not a new discovery. That possibility has been known for decades.

What’s new is its location and fuel crisis. It is located in the much larger Bowen Basin, which has many coal mines. In recent years, the basin has become a gas hotspot. Oil and gas giants Shell (through its subsidiaries), Origin Energy and Santos extract gas and export it through the Port of Gladstone.

But gas isn’t the main reason we’re hearing about the Taloom Trough. It’s oil.

Australian oil and gas company Beech Energy and exploration companies including Omega Oil and Gas and Elixir are currently exploring the area.

Shell is the most advanced, with its pilot project already supplying 200 barrels of oil per day to the small Eromanga refinery 1,000 kilometers west of Brisbane, which can produce up to 1,250 barrels of diesel and other petroleum products.

Given Australia burns more than 1 million barrels a day, the Taloom Trough is a long way from reaching the trough.

Is talum really useful?

Australia’s two remaining refineries produce 22% of the country’s diesel, gasoline, jet fuel and other petroleum products. Last week’s fire at the Geelong refinery will change that equation slightly.

Supporters believe the Taloom Trough can produce enough oil (about 176,000 barrels per day) to meet the demands of these two refineries.

This would be significant because it rivals Australia’s largest oil producing field, Kingfish, located in the largely depleted Gippsland Basin off the Victorian coast.

Is this plausible? Early exploration results indicate that there is gas and oil in the Taloom Trough. These products may find a market if extraction is commercially viable.

What is less clear is whether Taloom’s oil type (light crude) is the appropriate type. There are many types of petroleum, each requiring different distillation techniques and production volumes.

Refining light crude oil yields more gasoline than diesel or jet fuel. It will do little to tackle Australia’s most pressing problem: diesel shortages.

Approximately 54% of the oil Australia consumes each day is diesel, followed by petrol (25%) and jet fuel (approximately 15%). Australian refineries produce 40% diesel fuel, 32% diesel fuel and 10% jet fuel. This means that refineries cover about 37% of the country’s gasoline, but only 13% of diesel.

There is another challenge. The hydrocarbons of the Taloom Trough are trapped in rock 3-4 km underground. These resources are known as tight gas or tight oil. Extraction requires hydraulic fracturing, commonly known as fracking.

Because hydraulic fracturing uses large amounts of water, companies will likely consider pumping water from the Great Artesian Basin or the nearby Dawson River, or using recycled water from the hydraulic fracturing process.

In any case, the region’s large agricultural sector may oppose oil and gas interests that use the water, especially given concerns about potential groundwater contamination. Previous attempts to crush agricultural areas have sparked strong resistance from groups such as Lock the Gate.

Supporters may see this year’s fuel crisis as a way to hasten the opening of the Taloom Trough. But that’s not the only domestic option. The Dorado oil field was discovered in 2018 off the coast of Western Australia. Its potential resources could nearly double Australia’s commercial oil reserves. Although there is interest, it has been postponed several times.

Will history repeat itself?

In 1964, oil began leaking from Australia’s first oil field, the Mooney field in Queensland. This success led to significant interest in domestic oil and led to exploration of the Gippsland Basin, which has delivered more than 5 billion barrels of oil to date.

In 1973, during the Arab countries’ embargo, the oil shock hit the world economy for the first time. In Australia, the ‘Randall Twins’ of Southern Pacific Petroleum and Central Pacific Minerals promised a solution. They wanted to develop the Stuart oil field near Gladstone, which they claimed contained 20 billion tonnes of shale oil and was larger than the giant North Sea fields. The two small and medium-sized companies brought oil giant Exxon into the project, but Exxon withdrew when the project failed financially and environmentally.

Despite support from the state government, both companies went into receivership in 2003.

It’s too early to say whether the Taloom Trough will work. That could be a new moony that could lead to a revival of domestic oil. However, it could be Randall’s long-lost brother, who despite much hype has never materialized.