Tasman shares 74pc higher on SA potentialArticle from: The...

Tasman shares 74pc higher on SA potential
Article from: The Advertiser

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CAMERON ENGLAND

July 15, 2008 04:30pm

TASMAN Resources shares closed 74 per cent higher after it said South Australia's Arckaringa Basin could have the potential for oil shale deposits.

The Perth company said testing of one sample from a recent 33-hole drilling program at its Garford project, 80km southwest of Coober Pedy, showed the potential to yield 0.7 barrels, or about 117 litres, of hydrocarbons per tonne of material.

Oil shale is organic-rich shale, which can yield substantial quantities of oil and gas through heating and distillation.

Tasman executive chairman Greg Solomon said the early drill work suggested the organic-rich sediments discovered could stretch as much as 40km in length, and were at shallow depths of between seven and 15 metres. Two-thirds of the 33 drillholes encountered significant thicknesses of material.

Tasman shares jumped 74 per cent on the news yesterday, closing 7c higher at 16.5c.

Mr Solomon said while this raised the possibility of a large deposit, it was "very early days yet''.

"We will, however, commence an immediate follow-up work program, involving sampling and analysis of the existing holes drilled in the first pass,'' Mr Solomon said.

"Tasman will also undertake further broad-spaced drilling to determine the distribution and thickness of the organic-rich mudstones.''

Only one 2m sample from the 33 holes drilled was tested for its oil shale potential.

Mr Solomon said this was because the testing process was expensive and the company would now progress with further analysis.

He said a process called pyrolysis gas chromatography was used to test the first sample, returning a value of 19.9 per cent for C15 to C31 hydrocarbon abundances.

"Typically, a cut-off value of 5 per cent is used to differentiate between a gas prone source rock and an oil prone source rock, so this sample has extremely good potential for oil generation,'' he said.

"It yielded 10.6 kg/tonne of volatile hydrocarbons and 95.4 kg/tonne of hydrocarbons released through thermal cracking, for a total yield of 106 kg/tonne.

"These values are comparable to those derived from other oil shale deposits like Nunavut in Canada.

"Follow-up work will lead into extensive hydrocarbon analysis of each hole, to determine if the overall volume and oil-generating capacity are potentially economic.''

Tasman said it would contract an international expert with experience in oil shale deposits to review the existing data from Garford and advise on future test work.

It said petrological studies indicated the organic material was plant, rather than algal derived.

"Whereas plant-derived organic material is often not viewed as a favourable source of oil and is considered more likely to generate gas, there are exceptions,'' Tasman said.