-- Australia's renewed interest in Queensland's Taroom Trough oil resources could turn out to be over-hyped and fail to deliver a meaningful boost to the country's energy supply, the Institute for Energy Economics and Financial Analysis said on Wednesday.
The Queensland Premier David Crisafulli has pitched the option of extraction from the resources, which lie close to the town of Roma. Federal Environment Minister Murray Watt has asked for details of any such plans, given that pumping the resources would require use of controversial fracking.
Australia's domestic oil production has plummeted from near self-sufficiency around 2000, prompting the closure of most domestic refineries. It now produces just 5.6% of its needs domestically, IEEFA said and imports about 90% in the form of crude oil or fuels at a cost of AU$51 billion ($36.49 billion) in 2025.
Australian oil and gas company Beach Energy and exploration companies Omega Oil and Gas and Elixir are now exploring the zone, IEEFA's research said. Shell already produces 200 barrels a day from the area to the Eromanga refinery, it noted.
Supporters of the project believe the Taroom Trough could yield enough oil to fully supply 176,000 barrels a day to the country's two refineries.
IEEFA cautions that the viability of commercial extraction is not yet confirmed and it's also unclear if the light crude in the ground is of the right type for the country's refineries. Given light crude yields more gasoline than diesel or jet fuel, it would make only a small dent in the country's most urgent energy issue which is a lack of diesel.
Extracting the oil would likely involve taking water from the Great Artesian Basin and nearby Dawson River, IEEFA said, which could raise objections from the region's large agriculture sector, not only over potential scarcity but also the possibility of groundwater pollution.
IEEFA points out that Taroom Trough is not Australia's only option to boost domestic oil output. The Dorado oil field discovered off Western Australia's coast in 2018 could single-handedly almost double the country's commercial oil reserves but work on it has been repeatedly deferred.