South Australia May Be Sitting on an Oil Gold Mine

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Turns out South Australia isn’t just a gold mine for wine production.

According to the Adelaide Advertiser, Brisbane-based Linc Energy estimates that the Arckaringa Basin surrounding Coober Pedy – an untapped resource – may have anywhere from 3.5 billion to 233 billion barrels of oil in it.

That supply, previously valued at more than $20 trillion, would be enough shale oil to make Australia a self-reliant oil exporter. (Later reports have downplayed that financial figure, saying it’s too early to put a valuation on the reserves.)

Regardless, it’s an exciting prospect for Linc managing director Peter Bond.

"Shale gas and shale oil will be a key part to securing Australia's energy security now and into the future,” said Mr Bond.

"If it comes in the way the reports are suggesting, it could well and truly bring Australia back to (oil) self-sufficiency.”

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Linc has already drilled four deep wells and “a couple dozen” shallower wells in the Arckaringa Basin, and the company plans to drill up to six horizontal wells to determine the validity of its estimated figures. Having tapped Barclays Bank for investor support, Mr Bond expressed confidence in a “US-style shale oil boom” happening in South Australia.

"We have seen the hugely positive impact shale projects like Bakken and Eagle Ford have had on the US economy,” said State Mineral Resources Development Minister Tom Koutsantonis.

"There is still a long way to go, but investment in unconventional liquid projects in South Australia will accelerate as more and more companies such as Linc Energy and Altona prove up their resources.”

The project, which would involve an open-cut coal mine and potentially a 560-megawatt power plant, would reportedly cost up to $3 billion.