What is Oil Shale?
What is the difference between oil shale and shale oil?
What is the difference between the Paraho II technology and the previous ATP technology used on the Stuart plant?
Who is QER?
What is the potential of QER’s oil shale resource base?
Would QER mine oil shale within a World Heritage Area?
How much oil can QER extract per ton of rock?
Where are the deposits located?
What are QER plans at this stage?
What is the difference between oil shale and tar sands?
Where else in the world would we find oil shale projects?
What will shale oil be used for?
Would QER be producing diesel directly on the facility?
Why should Australia develop its oil shale resources?
Why can’t Australia simply import oil to offset the decline in production?
What is the New Fuels Development Centre?
Why has QER selected the Paraho II™ technology?
How much oil will be produced by the demonstration plant, and how will it be used?
How will QER measure any emissions from the technology demonstration plant?
Will the technology demonstration plant produces greenhouse gas emissions, and if so, how much?
What approvals has QER obtained from government authorities?
Oil 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 a lacustrine, or freshwater lakes environment. (see Oil Shale Formation). Total oil reserves in Queensland oil shale deposits total more than 20 billion barrels, while global estimates of oil shale reserves are around 3 trillion barrels.
Q: What is the difference between oil shale and shale oil?
A: Sometimes our project gets mixed up with “shale oil” or “tight oil”, but our process is quite different. In our process we mine the rock and then heat it up in a processing plant on the surface. Our process converts organic matter inside the rock (called ‘kerogen’) into an oil mist which is condensed and treated. As the process occurs inside the plant, we contain and treat the gases, liquids and solids involved. ‘Shale oil’ or ‘tight oil’ is a different process altogether and refers to extraction of liquid oil from rocks by drilling and fracturing (fracking) the rock underground. QER’s process does not involve fracking.
Full animations of our process are available on this site and at www.qervisitorcentre.com.au.
Q: What is the difference between the Paraho II technology and the previous technology used on the Stuart plant?
A: The old plant used a completely different technology. Below are pictures of the two plants. The old had to keep continually rotating and operators had to keep material moving through it. The new plant is fixed in place and at any time, we can ‘turn it off’ if we want to, and keep the processed material contained inside it. Our new plant is simpler with fewer parts. Material moves more slowly through it, so it is easier to control. The material in it is like coarse gravel - about the size of cherries, meaning there’s less dust to manage. The process is completely contained, quiet and clean. Which is why since the plant started operating in September 2011, we have had no complaints about it from the community.
The company also has developing interests in coal seam gas (CSG) with the acquisition of five exploration permits covering some 23,000km² in western Queensland.
We aim to build and operate a commercially viable and sustainable large-scale shale to liquids processing plant in Queensland.
See the About QER section to know more about the company and its values.
Q: What is the potential of QER’s oil shale resource base?
A: In total, QER has a net resource base of 15.8 billion barrels of oil in place. This resource is approximately equivalent to three times that of the Bass Strait oil fields.
Billion US barrels
QER is currently assessing options for development of a commercial oil shale project for the Stuart oil shale deposit, near Gladstone in Queensland.
While a part of the oil shale deposit does extend under Fisherman’s Landing and is therefore within the Great Barrier Reef world heritage area, QER has absolutely no intention of mining that part of the deposit – now, or at any time in the future.
In fact, QER has committed to incorporating a 100 metre buffer zone ‘above’ the High Astronomical Tide limit to define our potential reserves within the deposit.
To underline that commitment, it is worth pointing out that in addition to its World Heritage Area coverage, the Fisherman’s Landing area itself has been completely bunded and filled with dredging material, and contains significant infrastructure, adjacent to the Cement Australia and new port facilities.
Should QER proceed to a commercial project the mine would be onshore, using a typical open-cut method and the processed shale would be returned to the mine area for rehabilitation of the land.
See QER oil shale reserve locations for a detailed overview
Q: What are QER plans at this stage?
A: QER is operating a small scale demonstration plant at our New Fuels Development Centre near Gladstone, in Queensland, to highlight to governments and the community the superior operability of the Paraho II™ oil shale processing technology.
Q: What is the difference between oil shale and tar sands?
A: Oil shale is a rock, tar sands is sand, so dust. The process is also different.
Q: Where else in the world would we find oil shale projects?
A: There has been an oil shale industry in the European nation of Estonia for many years, mainly as a source of power for the country’s energy network. Oil shale industries have also been developed in China and Brazil, and are under development in the USA, Russia, Morocco and Jordan.
Carbon-based fuels will be needed for decades to come for road and rail freight, shipping and aviation. The world’s economy is based on the ability to transport people, food and goods and there are no emerging technologies which have the energy density capability to power heavy transport.
Sustainable development of Australia’s important oil shale resources provides an opportunity for QER to responsibly contribute to the nation’s increasing demand for heavy transport fuels.
Q: Would QER be producing diesel directly on the facility?
A: QER has commissioned a small-scale oil upgrader to produce ultra-low sulphur diesel and jet fuels, mainly for testing purposes. The plant will also produce small amounts of fuel oil.
Q: Why should Australia develop its oil shale resources?
A: The world’s easily developed conventional liquid oil reserves are diminishing and are not being replaced at an adequate rate by alternate energy sources. In Australia:
- oil production has fallen from 100% self sufficiency in 2000 to just over 50% in 2008, with forecasts it will drop to just 18% by 2030.
- Production has dropped from 248 million barrels of oil and condensate in 2000 to 159 million barrels in 2008 and will continue to decline unless alternative sources of fuel are developed.
- demand for oil rose to 341 million barrels in 2007 and is forecast to increase to at least 474 million barrels by 2030.
QER holds rights over resources with the potential to yield up to 15.8 billion barrels of oil – almost three times the size of the Bass Strait oilfield. Sustainable development of Australia’s important oil shale resources provides an opportunity for QER to responsibly contribute to the growing demand for heavy transport fuels.
In addition, a sustainably developed shale to liquids industry has the potential to yield investments in the billions of dollars, provide thousands of jobs and significantly reduce Australia’s import bill.
Q: Why can’t Australia simply import oil to offset the decline in production?
A: Australia’s current import bill for oil is just over $13 billion. Economic analysis by ACIL Tasman has estimated the cost of meeting the oil production shortfall through imports alone could be as much as $128 billion per annum by 2030.
These figures pre-suppose Australia’s ability to source oil imports in an increasingly competitive world market. Australia currently sources most of its imported oil from the Asia-Pacific region, which is also the region of highest growth in demand, particularly in countries such as China and India.
Declining self-sufficiency leaves Australia vulnerable in a security context, particularly as we may be forced to source supplies from geopolitically unstable regions such as the Middle East and former Soviet Union nations.
Q: What is the New Fuels Development Centre?
A: QER’s New Fuels Development Centre at Yarwun, located about 15 kms north of Gladstone in Queensland, is a purpose-built facility designed to demonstrate the operational performance of the Paraho II™ technology to governments and the broader community.
The Centre will highlight the operational performance of the Paraho II™ technology, and showcase the particular qualities of shale-derived fuels through the production of high cetane, ultra-low sulphur diesel for Australia’s heavy transport sector, and high quality fuels for our aviation sector.
It is important for the community to have information available to it regarding the development of new fuels, and therefore the facility has a Visitor Centre where information and educational resources will be readily available 7 days a week.
The New Fuels Development Centre is an initial step that could, over time, lead to the development of a major new industry generating thousands of jobs, and providing greater fuel security for Australia’s heavy transport sector.
Q: Why has QER selected the Paraho II™technology?
A: Following an investigation of more than 60 technology variants for extracting oil from shale, QER selected the Paraho II™ process for its simplicity, robustness, reliability, safety of operation and environmental performance.
From 2005 to 2010, QER tested almost 10,000 tonnes of Queensland oil shale involving more than 5,000 hours of operation at a Paraho II™ retort in the USA. Results from the test programs were extremely positive on environmental and operations performance grounds.
Specifically, the primary performance benefits of the Paraho II™ process are:
High availability – mechanical simplicity from the vertical, gravity-feed design translates into minimal downtime and high availability
High oil yields
Operationally flexible allowing for steady retorting operations and consistent high oil yields
Energy efficiency – high thermal efficiency allows for better capture and re-use of generated process heat, resulting in overall lower operating costs
Safe operation – the low pressure, thermally encapsulated process with few moving components is safe to operate
Environmentally sound – thermal extraction process generates typical waste streams that are easily manageable with currently available industrial emissions control technologies
Q: How much oil will be produced by the demonstration plant, and how will it be used?
A: The plant is designed to operate at around 2.5 tonnes per hour of oil shale feed, producing approximately 37 - 40 barrels of shale oil per day. During operational periods, the plant will run 24 hours per day.
Oil derived from shale, also known as kerogen oil, is a synthetic crude oil and is suitable feedstock for Australia’s refineries – particularly for production of ultra-low sulphur diesel and other transport fuels including aviation distillate. The oil produced from the technology demonstration plant at QER’s New Fuels Development Centre will be upgraded on site to produce a range of refined transport fuels for detailed trials and evaluation.
Q:How will QER measure any emissions from the technology demonstration plant?
A: The processing of minerals generally produces a range of chemical emissions, and oil shale is no different. The emissions produced by the small-scale technology demonstration plant at QER’s New Fuels Development Centre will involve low levels and will be well within license limits determined by government approvals.
QER will conduct continuous monitoring of emissions within the plant precinct and will engage consultants to conduct regular sampling. Additional monitoring will be conducted near the mine site, with a particular focus on any dust emissions. The Department of Environment, Resources and Mining will also conduct regular monitoring from a nearby site in Targinnie.
QER is determined to minimise emissions wherever possible, and is investing heavily in technologies and processes aimed at addressing this issue.
QER has been involved in substantive testing of carbon storage opportunities such as the use of algae, and is also looking at the potential for co-generation, involving the recycling of energy produced during the processing of oil shale.
In 2009 QER commissioned RARE Consulting to undertake an assessment of the greenhouse gas emissions intensity of shale oil production, and elements of the Australian industrial commodities sector.
The RARE research shows the CO2 emissions performance of shale oil production compares favourably with a number of other well known and widely produced industrial commodities.
Q: What approvals has QER obtained from government authorities?
A: QER has obtained all necessary approvals in order to mine oil shale and construct and operate the small-scale Paraho II™ processing technology demonstration plant.
QER’s New Fuels Development Centre lies on land owned by QER located within Mining Lease 80003. The Mining Lease was granted in 1996 for a period of 30 years to provide for both the mining and processing of oil shale and the production and processing of shale oil on the site.
QER holds both mining and petroleum Environmental Authorities which have been granted by the Department of Environment and Resource Management. These Environmental Authorities contain stringent conditions which ensure that emissions from the mining operation and processing plant are very low, and specifically set to protect air quality in the local environment.
The licences also contain conditions which will ensure protection of other aspects of the local environment: for example, surface water, groundwater, noise amenity, and land.
As with any industrial operation, the applicable licence conditions require detailed monitoring by QER of plant operating conditions and emissions and reporting to relevant Government authorities on an agreed basis.
Queensland Mines and Energy has granted a Petroleum Facility Licence for processing of the shale oil, including upgrading and storage of the oil.