Taroom Trough Development: Queensland's Push for Domestic Fuel Security

The Queensland LNP government has approved new oil and gas exploration in the Taroom Trough, describing it as a "generational opportunity" for national fuel supply.

Project Overview and Location

The Taroom Trough, located near Miles in southern Queensland approximately 300 kilometers west of Brisbane, covers an area of 750 square kilometers. This "tight" oil and gas field contains oil situated between three and four kilometers underground, requiring horizontal drilling and hydraulic fracturing (fracking) for extraction.

Shell has already commenced production of 200 barrels of oil per day from the Taroom Trough, with the crude oil reported to be suitable for domestic use.

Regulatory Actions and Government Moves

State-Level Approvals

Deputy Premier and Planning Minister Jarrod Bleijie announced a new Works Regulation on Friday, allowing the Coordinator-General to fast-track development.

Queensland Premier David Crisafulli announced plans to construct roads and trunk infrastructure to support the proposed oil field.

Federal Requests and Response

Premier Crisafulli has urged the Australian federal government to accelerate environmental approvals, specifically requesting that fossil fuel projects be made eligible for "national interest" exemptions under federal environmental laws.

Federal Environment Minister Murray Watt acknowledged mechanisms exist to simplify approvals but clarified that "national interest" exemptions under the Environment Protection and Biodiversity Conservation Act cannot apply to fossil fuel projects. Watt suggested the state government should focus on immediate fuel cost and supply issues.

Preferred Tenderers

Omega TN Pty Ltd, Tri-Star Stonecraft Pty Ltd, and Drillsearch Energy Pty Ltd have been appointed as preferred tenderers for the project.

Official Statements

"Unlocking the Taroom Trough is critical for future national fuel security" — Queensland Premier David Crisafulli

"Coordinated development in the Taroom Trough ensures efficient and fast-tracked development to bolster national fuel security" — Deputy Premier Jarrod Bleijie

"My message to industry is clear; I'll sign, you drill" — Minister for Natural Resources and Mines Dale Last

Western Downs Mayor Andrew Smith endorsed the push for expedited approvals, anticipating new investment and job creation. He noted this marks a shift to oil exploration after 50 years of focus on gas.

Industry Perspectives

Rick Wilkinson, Chief Executive of Energy Quest, reported "encouraging oil results" from existing players and identified the Taroom Trough as one of Australia's most promising onshore oil and gas exploration areas on the east coast, noting the oil discovered is light crude or condensate suitable for domestic refining.

Tony Wood, Senior Fellow at the Grattan Institute, noted that analysis suggests liquid resources from the Taroom Trough could produce petrol, diesel, and aviation fuel. He described the potential "prize" as substantial but cautioned about the unforeseen complexity of drilling an "older, deeper, and more impervious" resource requiring fracture stimulation.

Richard Cottee, Chair of Elixir Energy, expressed confidence in advancements in horizontal drilling technology and argued that projects close to existing infrastructure with significant reserves can be economic.

The Inland Oil Refinery (IOR) in Eromanga

Current Operations

The Inland Oil Refinery (IOR) in Eromanga, a town with fewer than 50 residents located approximately 1,000 kilometers west of Brisbane, has operated since 1986. It produces up to 1,250 barrels of oil per day, sourcing crude from the Cooper-Eromanga basin and South Australian oil fields. The refinery produces solvents and diesel, primarily for mining operations, and a small amount of on-road diesel for the local community.

Expansion Considerations

IOR chief executive Drew Morland stated that the refinery's output is mainly restricted by supply and that if production volumes from the Taroom Trough grow as anticipated, it would be appropriate to consider expanded processing capacity.

Omega Oil and Gas chief executive Trevor Brown, whose company is a preferred tenderer, stated his company has used the Eromanga refinery during testing and is in discussions with IOR about future expansion to handle larger production volumes.

Strategic Importance

Bridgeport Energy chief executive Christian Lange described the IOR as "strategically critical" because it supplies diesel to the mining industry. University of Queensland professor Peter Knights noted that domestic fuel supply is a focus for the mining industry to ensure operational continuity.

IOR states that refining oil locally in Eromanga produces fewer emissions than transporting oil to Brisbane for refining and back.

Environmental and Conservation Concerns

The Queensland government's approval of new exploration has met with opposition from conservation groups:

• Groundwater and Emissions: Groups including Lock the Gate and the Queensland Conservation Council have raised concerns about potential impacts on groundwater quality, water consumption, and fossil fuel emissions.
• Prime Agricultural Land: Ellen Roberts, national coordinator for Lock the Gate, expressed concerns about groundwater contamination and stated the approval goes against a pre-election promise to protect prime agricultural land.
• Emissions Targets: Clare Silcock of the Queensland Conservation Council stated these announcements contradict the state government's emissions reduction target and that the government is facilitating coal and gas industries while hindering renewable energy development.

Additional Context

• Previous Approvals: The Crisafulli government previously approved three gas exploration sites in the Cooper-Eromanga basin in January.
• Renewable Energy Projects: The state government has called in Iberdrola Australia's 500 MW Bundaberg Regional Battery project for review, citing 337 public submissions with objections. It also changed the law to prevent the 1.2 GW Forest Wind project from proceeding. Five renewable projects are currently on Minister Bleijie's list of "ministerial call-ins."
• Energy Roadmap: The government's energy roadmap includes $1.6 billion to extend the operation of coal power stations.
• Taroom Trough History: The Moonie Oil fields, also in the region, closed approximately 50 years ago.