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Oil & Gas Journal

Rick Wilkinson
OGJ Correspondent

MELBOURNE, Aug. 14 -- Brisbane-based oil shale hopeful Queensland Energy Resources Ltd. (QER) has shunned the Alberta-Taciuk Processor (ATP) revolving kiln oil shale processing technology in favor of the Paraho II technology to develop its vast oil shale deposits along Queensland's east coast.

The company chose Paraho II following assessment of 63 other possible technologies and noting the lessons learned from the company's now decommissioned ATP demonstration plant on the Stuart deposit near Gladstone. This plant is being dismantled, and obsolete components are being sold.

QER acquired most of the assets of the original operator Southern Pacific Petroleum (SPP) from the liquidator in 2004 and shut down the Stuart plant because it did not meet environmental and operating performance standards despite SPP's having produced and sold over a million barrels of shale oil from the deposit during 2000-03.

QER decided the ATP could not be scaled up to commercial scale production, whereas it believes the Paraho II technology can be a commercial proposition.

Paraho II technology has been tested with more than 8000 tonnes of samples of Queensland oil shale (which is mined by open cut methods).

QER says the deposits, collectively known as the McFarlane oil shale after the original and long-time chairman and champion of the SPP attempts to commercialize them, have the potential to produce 1.6 billion bbl of shale oil over the next 40 years.

If the shale oil is produced, it will supplement Australia's fast depleting deposits of conventional oil reserves.