Australia was self-sufficient in oil and petrol in 2000, but is 90% dependent today. Can we drill now? By Graham Lloyd in The Australian.
Since 2000 Australia’s liquid fuel equation has flipped. We have gone from being self-sufficient in oil and petrol, with eight refineries supplying 98 per cent of consumption, to having two refineries and a reliance on imports for roughly 90 per cent of our fuel needs.
Across the same two-decade period, the US has achieved the reverse …
Two Gulf wars and the ingenuity of a wildcat driller, George Mitchell, transformed the US from being dependent on the Middle East for crude oil to being the world’s biggest producer and an energy export superpower. The transformation is due to Mitchell’s discovery in 1997 of how to drill wells horizontally and liberate oil and gas held deep underground in rock formations. …
It can be argued that … Australia has performed its own feat of energy self-harm. Exploration for oil has been allowed to falter and production of liquid fuels has been sent offshore by a combination of economies of scale, lack of investment and strict environmental mandates from government.
In Australia, climate change has become the crisis that drives energy policy. But, as the war in Iran has shown, energy security is about a lot more than phasing out coal-fired power stations to make electricity.
Australia runs on diesel fuel. Fossil fuels produce the fertilisers we need to grow our food and export crops. Fossil fuels make plastics that are ubiquitous to construction and modern life. Diesel-powered cranes unload containers at the wharves and diesel-powered machinery mines the coal and iron ore we export and fuels the trucks that keep our supermarket shelves stocked. …
We must decide if we want to re-establish domestic energy security or remain dependent on extended import supply lines at a time of global upheaval and potential conflict.
Facing up to reality:
The failure of the last best chance to replace the dwindling oil reserves from Bass Strait can be traced to another crisis: BP’s Deepwater Horizon disaster in the Gulf of Mexico. The Deepwater crisis gave environment groups the leverage they needed to campaign against BP’s ambitions to drill for oil in the deep waters off the Great Australian Bight. …
[BP’s] oil spill modelling showed a Deepwater Horizon-style spill in the bight could take more than six months to control, would be certain to hit land and would spread oil for thousands of kilometres. If a spill happened there was a “high probability” it would affect important marine species, including sperm whales and pygmy blue whales.
After BP pulled out, Norwegian energy giant Equinor was given permission to drill for oil in the Great Australian Bight but it also pulled out in February 2020, citing poor project economics. Equinor said the project did not stack up financially with other global energy projects. This is despite estimates that more than nine billion barrels of oil could be extracted from several fields, making it — despite the much deeper waters — the logical replacement for dwindling reserves in Bass Strait.
The discovery of oil in Bass Strait in the Gippsland Basin off Victoria in 1965 by Esso and BHP fundamentally changed the nation by delivering energy self-sufficiency. More than five billion barrels of oil have been produced from Bass Strait across five decades but production has been in steady decline since peaking in the 1980s.
Drill baby drill:
According to Geoscience Australia, the Northern Carnarvon Basin in Western Australia is Australia’s most prolific oil-producing region, accounting for nearly 70 per cent of the country’s remaining identified crude oil resources. …
There is renewed interest in Queensland’s Surat and Bowen basins, where the Taroom Trough has been identified as a “new oil frontier”, with major exploration and appraisal drilling under way. …
But, as in the US, shale oil could be our big untapped potential. The Beetaloo Basin is a massive, highly prospective shale gas field in the Northern Territory that is transitioning from exploration to commercial production, with first gas sales to the NT domestic market targeted for mid to late 2026. Several key wells in the Beetaloo Basin have confirmed the presence of liquid hydrocarbons with estimates of hundreds of millions of barrels.
The same is true for the Canning Basin in Western Australia.
The question is whether Australia still has the institutional and political wherewithal to drill baby drill.
I could tell a royal commission into the climate models where the problems are and how they overestimate warming due to carbon dioxide by a factor of about five. Vastly cheaper than wasting trillions on bad energy policy and polluting the environment with wind turbines, solar farms, and transmission lines.