Frequently Asked Questions

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?
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?

Q: What is Oil Shale?
A
:Sometimes known as ‘the rock that burns’, oil shale is an organic-rich sedimentary rock containing kerogen, an organic chemical compound that when heated can produce oil.

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.

                  QER's Paraho Demonstration Plant                                                                      ATP Plant


Q: Who is QER?
A:
QER is an integrated resources company that holds the rights to several large oil shale resources in Queensland, Australia, with an oil production potential larger than Bass Strait.

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 QER at a glance page 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.

Deposit Resource
Billion US barrels
QER
Net Interest
QER
Net Resource
McFarlane 4.8 100% 4.8
Yaamba Group 4.0 100% 4.0
Duaringa 2.5 100% 2.5
Stuart 2.6 100% 2.6
Rundle 2.6 28% 0.7
Nagoorin 2.4 25% 0.6
Nagoorin South 0.4 100% 0.4
Lowmead 0.7 25% 0.2
Total 20.0   15.8

 


Q: Would QER mine oil shale within a World Heritage Area?
A:
QER has no intention of mining oil shale within any world heritage areas.

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.


Q: How much oil can QER extract per ton of rock?
A:
Between 60 and 220 litres per ton of rock shale


Q: Where are the deposits located?
A:
The vast majority of Australia’s oil shale resources are located in Queensland.

See QER Resources Tenements for a detailed overview


Q: What are QER plans at this stage?
A:
QER is currently planning the development of a small-scale commercial oil shale facility, following the completion of its Paraho technology demonstration plant project at our New Fuels Development Centre near Gladstone, in Queensland.

Commissioned in September 2011 the demonstration plant successfully highlighted to governments and the community the superior performance and operability of the Paraho II™ oil shale processing technology, producing high-quality transport fuels in a contained, quiet and clean process.


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.


Q: What will shale oil be used for?
A
:
Shale oil is a suitable feedstock for Australian oil refineries in the production of diesel and aviation fuels. The kerogen (shale oil) produced at QER's technology deonstration plant was upgraded on-site to produce quantities of ultra-low sulphur diesel and aviation fuel, which are being used in a series of trials and certification processes.

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, medicines and other 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: 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 less than 50% in 2014, with forecasts it will drop to just 18% by 2030.
  • Production has dropped to its lowest level in more than 40 years, and will decline further with the announced closures of oil refineries in Sydney and Brisbane.
  • Demand for oil continues to increase, rising from around 340 million barrels in 2007 to now be more than 370 million barrels per year, and is forecast to increase to at least 475 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 more than $15 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 and fuel 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.

Australia's declining fuel security is highlighted in a special NRMA report, available at www.mynrma.com.au/about/fuel-security.htm

 


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 which was designed to demonstrate the operational performance of the  Paraho II™ technology to governments and the broader community.

During more than two years of operations, the Centre's technology demonstration plant highlighted the operational performance of the Paraho II™ technology, and showcased 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 is available 7 days a week.

The New Fuels Development Centre represents a project which 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 IItechnology?
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 retort in the USA.  Results from the test programs were extremely positive on environmental and operations performance grounds, leading to construction of the Paraho IITM technology demonstration plant at QER's New Fuels Development Centre near Gladstone.

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 was produced by the demonstration plant, and how has it been used?
A:
The demonstration plant was 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 ran 24 hours per day. 

Oil derived from shale, also known as kerogen oil, is a synthetic crude oil and is a 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 was upgraded on site to produce  refined transport fuels, mainly ultra-low sulphur diesel and aviation fuel 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. During more than two years of production the small-scale technology demonstration plant at QER’s New Fuels Development Centre underwent substantial monitoring and was found to produce low levels of emissions which were well within license limits determined by government approvals.

QER conducted continuous monitoring of emissions within the plant precinct and engaged consultants to conduct regular sampling. Additional monitoring wasconducted near the mine site, with a particular focus on any dust emissions. The Department of Environment and Heritage also conducted regular monitoring from a nearby site in Targinnie. The Department also conducted an environmental audit of the facility, which is available at www.ehp.qld.gov.au


Q: Did the technology demonstration plant produces greenhouse gas emissions?
A:
The technology demonstration plant produced high quality transport fuels from oil shale, and in the process produced low levels of greenhouse gas emissions.

QER is determined to minimise emissions wherever possible, and has invested heavily in technologies and processes aimed at addressing this issue.

QER has also 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 will QER obtained from government authorities?
A:
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 Heritage. 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 granted a Petroleum Facility Licence for processing of the shale oil, including upgrading and storage of the oil.

In February 2013, after a four-year review of oil shale and QER's Paraho technology, the Queensland Government determined QER could progress development of a small-scale commercial oil shale facility through stringent social and environmental approvals processes.