The U.S. is using new shale-oil finds to work toward energy independence, and so could Australia. The resource-rich country down under could achieve self-sufficiency in oil, if Brisbane-based Linc Energy’s AU:LNC lnc LNCGY recent reserve estimates come anywhere close to fruition.
The Australian energy firm released consultant-compiled estimates of prospective shale reserves in South Australia late Wednesday, prompting speculation — notably in the Adelaide Advertiser — that it could be sitting on as much as $20 trillion worth of oil.
The highest estimate of the potential reserves would eclipse all the oil in Australia, the regional Australian newspaper quoted Linc Chief Executive Peter Bond as saying. Such a discovery could bring Australia back to oil self-sufficiency, Bond went on to say, according to the Advertiser report.
Linc’s shares spiraled 29.2% higher in Sydney afternoon trading Thursday after the firm released the two estimates of unrisked prospective resource reserves in the Arckaringa Basin.
The estimates from the two petroleum industry consulting firms varied from as much as 233 billion barrels of oil equivalent from Gustavson Associates to 103 billion BOE from DeGolyer and MacNaughton. DeGolyer and MacNaughton also gave a risked mean estimate of 3.5 billion BOE.
Whichever estimate is considered, the reports “confirm the significant potential of shale oil in Arckaringa Basin,” said Linc.
Linc said that it believes the formation in the basis “compares favorably” to U.S. unconventional liquid plays, such as Bakken and Eagle Ford.
But the Sydney Morning Herald moved to pour cold water on the $20 trillion figure on Thursday, reporting Peter Bond as saying “that’s not our valuation.”
Bond went on to tell the paper “we wouldn’t put a valuation on it at this stage. It’s too hard.”
Unrisked prospective resources have the lowest level of certainty attached, the Sydney Morning Herald reported.
The firm is now working with Barclays Bank to find a joint venture partner with shale-oil expertise, and is willing to fund the development of its Arckaringa Basin assets, it said.
