Trillions of dollars worth of oil found in Australian outback
Up to 233 billion barrels of oil has been discovered in the Australian outback that could be worth trillions of dollars, in a find that could turn the region into a new Saudi Arabia.
The discovery in central Australia was reported by Linc Energy to the stock exchange and was based on two consultants reports, though it is not yet known how commercially viable it will be to access the oil.
The reports estimated the company’s 16 million acres of land in the Arckaringa Basin in South Australia contain between 133 billion and 233 billion barrels of shale oil trapped in the region’s rocks.
It is likely however that just 3.5 billion barrels, worth almost $359 billion (£227 billion) at today’s oil price, will be able to be recovered.
The find was likened to the Bakken and Eagle Ford shale oil projects in the US, which have resulted in massive outflows and have led to predictions that the US could overtake Saudi Arabia as the world’s largest oil producer as soon as this year.
Peter Bond, Linc Energy’s chief executive, said the find could transform the world’s oil industry but noted that it would cost about £200 million to enable production in the area.
More to come on how much it will cost to get the oil, but the takeaway is that the more we look for oil, the more we find. This 2005 op-ed from the Manhattan Institute’s Peter Huber and Mark Mills is a great read arguing the problem with oil isn’t that we don’t have enough, it’s that the oil in really, really bad places is so cheap to pump and can make the economics of oil in really, really good places too expensive to consider.