Kerogen is a naturally occurring organic substance which is found in some fine grained sedimentary rocks. When heated, it transforms into oil. Sometimes the term 'oil shale' is used, but this can be confusing because Kerogen Shale doesn't contain any oil.
Kerogen shale deposits vary considerably in nature and yield around the world. In Australia the largest deposits are in Queensland, and were formed around 40 million years ago in freshwater lakes. These deposits contain enough kerogen to produce around 20 billion barrels of oil. Kerogen deposits world-wide contain the equivalent of some 3 trillion barrels.
About 40 million years ago the central Queensland region saw the formation of a series of large elongated, fault-bounded lake basins. At this time the sea levels were about 150 metres lower than present with the Gladstone region more elevated and about 200 kilometres south west of the coastline as it was then.
The block diagram above shows a typical lake basin from this time. The lake’s water level rose and fell due to a combination of the basin floor sinking and changes in climate. The lake water chemistry varied as the water depth changed, and organic activity, resulting in periodic algal blooms along with a variety of plants and aquatic animals such as crocodiles, turtles and fish. Dead algae rained onto the lake floor, accumulating with silt and mud and the occasional dead crocodile or turtle. (We can sometimes see these now in fossil form in the kerogen shale deposits).
The rate of sediment and organic matter accumulation would at times exceed the basin floor subsidence and fill the lake causing the water level to shallow and periodically dry out. Renewed subsidence would allow the lake to reform. Over time this cycle of filling and subsidence resulted in the accumulation and preservation of the thick sequence of algae-rich lake sediments which hardended into rock . This rock contains kerogen, an organic chemical compound from which we can recover oil.
At this location just west of Gladstone, about 500 metres of oil shale accumulated in the lake basin known as The Narrows Graben. This occurred over a 10 million year period during the late Eocene to early Oligocene periods (between 40 million and 30 million years ago).
The kerogen shale deposits have formed as a sequence of layer groups. There are about 100 climatically controlled layers ranging from one metre to 7 metres thick but mostly about 3 metres thick. It is estimated that each layer took about 75,000 years to accumulate on the lake floor.