Queensland shale oil plant moves ahead

Queensland Energy Resources Ltd. (QER), Brisbane, has applied for Australian government environmental approval to upgrade its demonstration shale oil processing plant at Yarwun 15 km northwest of Gladstone to a commercial scale plant.

First commercial production is slated for 2018, and the plant is expected to have an operational life of 20 years.

QER says the plant will produce diesel and other fuel products, along with some byproducts.

The small-scale demonstration plant, capable of processing 2.5 tonnes/hr of oil shale, has been on line since October 2011. It uses the Paraho II gravity-fed retort process, which is mechanically simple, has high thermal efficiency, and contains all waste gases within the system.

The plant has produced at 37-40 b/d of synthetic crude and high quality ultralow-sulphur diesel and aviation fuel.

QER has not yet revealed the expected production rate of its proposed commercial-scale plant, but it does have a long-term goal of producing 50,000-70,000 b/d of transport fuel from a full-scale facility.

The plan is to build a pipeline from the plant to export products at Fisherman’s Wharf near Gladstone.

QER has interests in Queensland oil shale deposits totalling 16 billion bbl of shale oil in place.

However, at this stage the company is concentrating on the Stuart oil shale deposit at Gladstone where it has 100% interest and some rich yields.

Interestingly Stuart is next door to the Rundle deposit in which QER has 28%.

Rundle burst into the headlines in 1980 when now defunct companies Southern Pacific Petroleum and Central Pacific Minerals (known as the Rundle twins) brought in Esso Australia as a partner to develop the deposit billed as Australia’s oil saviour with potential “bigger than Bass Strait.”

The majority interest holder at Rundle is still ExxonMobil Corp., no doubt quietly watching on the sidelines to see if the Paraho II process at Stuart is the best way to development.

QER’s application for environmental approval has been made to satisfy requirements of the federal government’s Environment Protection and Biodiversity Conservation Act.

In 2008, the Queensland government had placed a 2-year moratorium on oil shale projects, effectively paralysing the proposed QER project in the McFarlane deposit about 15 km south of Proserpine on the state’s central east coast (OGJ Online, Aug. 25, 2008).

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