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An energy expert has poured cold water on debate about a revived Queensland oil industry, driven by government rhetoric around new exploration at a time of heightened public concern for rising fuel prices.
The Crisafulli government announced permits to explore for oil and gas in the Taroom Trough in the state’s south in February, in what it has said could be Australia’s first significant new oil province in 50 years.
Since, government figures have spoken about analysis of the scale of the available oil by the end of the year, and deliveries to refineries by 2028 – even a willingness to consider construction of a new oil refinery if needed.
“We must promise ourselves as a nation, never again will we be vulnerable entirely to foreign markets and foreign conflicts, ensuring our energy security,” Premier David Crisafulli told a Sunday meeting of the LNP state council.
In a media conference on Tuesday, Opposition Leader Steven Miles called on the government to ensure that “any oil produced in the Taroom Trough is reserved for Queenslanders”.
“The fact is, if these Queensland reserves are simply put into the global market, then they’ll do nothing to address price crises like the one we’re experiencing at the moment, and do nothing to provide additional fuel security,” Miles said.
Grattan Institute energy and climate change program director Alison Reeve told this masthead that any such refinery would come with a price tag of between $5 billion and $15 billion.
Reeve added if a new refinery was built, there is no certainty there would be enough oil available in the country – let alone the state – at current usage levels for whoever built it to recoup the cost.
“We’ve got roughly eight to 10 years’ worth of oil. We’ve got some shale oil, but we don’t know, like, what quality it is, how of it much there is, how easy it is to get. If you added that in, that’d give us another 35 years,” Reeve said.
She noted that refineries are also often either built in two ways. One is to cater to the quality of oil from specific locations – which Australia’s two remaining sites were until such reserves largely dried up, leaving them to refine imported oil.
Meanwhile, much of the oil Australia does still produce is exported to places like Singapore for refining in sites which operate in the second way. They have large enough capacity they can essentially blend different imported oils together to a consistent quality for processing into fuels.
“And so why don’t you import the fuel – let someone else do the refining step,” Reeve said.
She said it essentially came down to a question of “how much do we want to spend on insurance”.
“And, I mean, the thing with insurance is you usually find out that your willingness to pay kind of goes up when you’re in an emergency.
“The question that they [the government] should be asking themselves, is, if we are going to spend, I don’t know, pick a number, a billion dollars on fuel security, where do we get the most bang for buck by doing that – not how do we spend a billion dollars on an oil refinery.”
On whether any such oil could also be reserved for Queenslanders alone, Reeve said that in a situation of any kind of national importance the state would “probably have to secede from the Commonwealth or something before you get away with that”.
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