This report is a partial update of the national assessment series of Australia's energy resources, which was first released in 2010 and updated in 2014. This interim release provides an overview of Australia's identified and potential fossil energy resources: oil, gas, coal, uranium and thorium. It focuses on resource quantities.
A full update will be released in February 2017, and will add hydro, solar, wind, geothermal, bioenergy and ocean energy, along with market information.
The national assessment has been moved to a primarily internet-delivered format, offering improved functionality (including data download) and easier navigation. The publishing institutions are aiming to improve the ease with which users can gain an understanding of energy resources, and are seeking user feedback.
Australia has an abundance and diversity of energy resources (see Table 1). Since 2010, the estimated total demonstrated non-renewable energy resources, with the exception of oil, have increased. Australia continues to have the world's largest known economic uranium resources, the fourth-largest coal (black and brown) resources, and substantial conventional and unconventional gas resources. This globally significant resource base is capable of meeting both domestic and increased export demand for coal and gas, and uranium export demand, over the next several decades and beyond. There is good potential for further growth of the resource base through new discoveries. Identified resources of crude oil, condensate and liquefied petroleum gas (LPG) are more limited, and Australia is increasingly reliant on imports for transport fuels.
Australia is a major global producer and exporter of energy commodities. Australia is the world's third-largest producer of uranium, and the fourth-largest producer and second-largest exporter of coal. It is set to become the largest producer and exporter of liquefied natural gas (LNG) in the next five years. In 2015, Australia exported 76 per cent of the energy it produced.
Energy markets have fluctuated over the past two years, with significant drops in international oil, gas, coal and uranium prices. Expenditure on exploration for energy minerals and petroleum has continued to decline (ABS 2016) (in constant dollar terms). Coal exploration expenditure fell from $809.3 million in 2011 to $210 million in 2015. Uranium exploration expenditure fell from a high of $254.9 million in 2008 to $39.5 million in 2014, and increased slightly to $43.3 million in 2015. In the single year 2015, petroleum exploration expenditure declined by 43 per cent to $2.7 billion (OCE 2016).
Exports of LNG have begun from Queensland, exposing Australia's east coast energy market to international gas pricing for the first time. The commencement of LNG exports from the eastern market has rapidly increased the level of supply required. Despite high domestic gas prices and the depletion of existing fields, investment is being constrained by low international prices and the limited availability of capital. If new supply is not developed over the next few years, there is a risk of shortfalls in production capacity in the medium to longer term (OCE 2016).
Australia has a rich diversity of renewable energy resources (wind, solar, geothermal, hydro, wave, tidal, bioenergy). Hydro energy resources are already mostly developed. Use of wind and solar energy resources has grown since 2010, and is continuing to grow strongly. Geothermal use for electricity generation remains minimal, while use of lower temperature resources and ground-source heat pumps for heating and cooling is increasing. Ocean energy resources remain largely undeveloped. Renewable energy resources could contribute significantly more to Australia's future energy supply than they currently do.
Australia's transformation to lower emissions energy sources has commenced under the influence of the Renewable Energy Target of 33 000 gigawatt-hours of electricity generation from renewable resources by 2020 (CER 2015). As well, the Direct Action Plan has as its centrepiece the Emissions Reduction Fund to help reduce Australia's greenhouse gas emissions by 5 per cent on 2000 emissions by 2020 (DIIS 2015).
Australia's energy demand, after being strongly positive for decades, has declined slightly (AER 2015). This slowing is due to several factors, including energy efficiency improvements, a decline in energy-intensive industries, and higher electricity prices. Australia's primary energy consumption was 6016 petajoules (PJ) in 2014-15 and is projected to increase to 8541 PJ in 2049-50 (OCE 2014). The primary fuel mix is expected to change. Although coal is expected to continue to dominate Australia's electricity generation, a shift to lower emissions fuels is expected to result in a significant reduction in coal's share, and increases in gas and renewable energy use, particularly wind and solar.
Australia's energy infrastructure is concentrated in areas where energy consumption is highest and major fossil fuel energy resources are located. Greater use of new energy resources, particularly renewable energy sources, will require more flexible and decentralised electricity grids. Reduced electricity demand since 2008 has led to significant coal- and gas-powered generation plant being permanently or temporarily removed from the market, with capacity withdrawals exceeding new generation entry by wind and solar (AER 2015).
|Resource||Demonstrated resource (PJ)|
|Coal||2 330 966|
a Reasonably assured resources recoverable at less than US$130/kg U
b Excludes 84 435 PJ of contingent oil shale
Australia's abundance of energy resources is a key contributor to the nation's economic prosperity. In 2014-15, the Australian energy sector directly accounted for around 6 per cent of gross industry value added, contributed 39 per cent of total export value, supported a large range of manufacturing industries, and provided significant employment and infrastructure (OCE 2015). Australia was the world's eighth-largest energy producer in 2013, and in 2014-15 exported $67 billion of energy products and imported $34 billion in refined petroleum products. Export of LNG from Queensland commenced in late 2015. Together with expansion of the Gorgon (Western Australia) project, this will elevate Australia in world energy export rankings very quickly.
The energy sector currently accounts for three-quarters of Australia's greenhouse gas emissions. Australia's energy needs have been largely met by fossil fuels, but the transformation to a lower emissions economy has now commenced. Oil is Australia's largest source of energy, accounting for 38 per cent of consumption in 2013-14. Australia's transport system is heavily dependent on oil, much of which is imported. Coal is the second-largest source of energy, but its share has been falling, down from 42 per cent a decade ago to 32 per cent in 2013-14. The use of natural gas has increased, particularly for power generation and by industry, rising by 2 per cent in 2013-14 to 24 per cent of energy consumption. Renewable energy consumption rose by 4 per cent in 2013-14, to 6 per cent of total energy consumption, or 15 per cent of electricity generation (OCE 2015).
The global energy system will change fundamentally over the coming decades. While energy demand will continue to grow, lower emissions energy sources and technologies will progressively capture market share, and diversify the world's energy supply. In 2012, fossil fuels accounted for 15.5 terawatt-hours (TWh) or 68 per cent of global electricity generation. The International Energy Agency, under its New Policies Scenario, expects this to increase to 22.2 TWh, or 55 per cent of global generation, by 2040. Nuclear power is also expected to grow from 11 per cent to 12 per cent of global generation over the same period (DIIS 2015).
Australia has a wealth of energy resources, which is the basis of its growing stature as a global energy superpower. Australia's energy future will be shaped by delivering energy products and services to households, businesses and international markets reliably and cost-effectively, so that Australia can take full advantage of its natural endowment. This will be achieved through:
Australia is richly endowed with natural energy resources, which enables it to play an important role in supplying the world's energy needs. Australia has the largest uranium economic resources in the world (estimated at 32 per cent of world resources), is the fourth-largest holder of economic coal resources in the world (estimated at 8.6 per cent of world resources), and has large and growing gas resources (currently 2 per cent of world natural gas resources). Australia has limited oil reserves, currently accounting for about 0.2 per cent of world reserves. Our potential renewable energy resources base is very large and widely distributed across Australia.
Australia is the world's eighth-largest energy producer (OCE 2015), accounting for around 2.4 per cent of the world's energy production. Australia produces energy for meeting our domestic energy needs and for exports. It is currently one of the world's largest exporters of coal and uranium, and is ranked fourth in LNG exports (but increasing rapidly with new LNG exports from Queensland and the Gorgon project). In contrast, Australia has limited domestic supplies of crude oil and is increasingly reliant on imports for its transport fuels.
Australia is a net energy exporter, with 72 per cent of total energy production being exported. In 2014-15, Australian energy resources generated $67 billion worth of energy exports (OCE 2015), compared with $77 billion in 2011-12; the decrease was caused by low world prices for oil, gas and coal.
Australia is the world's 20th largest consumer of energy (the same as in 2008) and was the 17th largest in per capita energy use in 2013 (compared with 15th in 2008).
Australia's energy market differs from that of many other countries in the Organisation for Economic Co-operation and Development (OECD), and world energy markets. Coal plays a much larger role in Australia's fuel mix, reflecting our large, low-cost resources located near demand centres. The penetration of gas in Australia is similar to that of the OECD and world averages, as is that of wind and solar. On the other hand, Australia has less hydro energy resources, makes less use of bioenergy than some countries, and does not use nuclear power.
Australia's energy production was 18 715 PJ in 2014-15, which was 4 per cent lower than in the preceding year, but 1.1 per cent higher than over the preceding decade. In 2014-15, the main energy sources produced, on an energy content basis, were coal (66.4 per cent), uranium (13.9 per cent) and gas (13.2 per cent). Renewable energy accounted for nearly 2 per cent of total production in 2013-14, unchanged from 2008-09 (OCE 2015).
Australia has abundant, high-quality fossil fuel resources, notably coal (black and brown) and gas (conventional, coal seam gas, and potentially shale and tight gas) resources, which are widely distributed across the country. Resources of oil (crude oil, condensate and LPG) are more limited (especially crude oil resources), and Australia relies increasingly on imports to meet demand for transport fuels. With the exception of crude oil, Australia's fossil fuel resources are expected to last for many more decades, even with increased levels of production.
Coal is Australia's largest energy resource. At the end of 2014, Australia's recoverable economic demonstrated resources (EDR) of black coal were 1 721 910 PJ (63.3 billion tonnes [Gt]), an increase from the 2008 estimate of 883 400 PJ (39.2 Gt). Most of these resources are located in the Sydney and Bowen basins, although significant black coal resources also occur in the Surat, Galilee and Clarence-Moreton basins. Australia's EDR of black coal are sufficient for about 112 years at current production rates, which is a drop in the resource-production ratio from 125 years at 2012 production rates.
In 2014, Australia's recoverable EDR of brown coal resources were estimated to be 609 056 PJ (62.0 Gt), an increase from 2008 (362 000 PJ; 37.2 Gt). This substantial growth was mostly due to a major revision of brown coal resources data. Almost all these resources (99 per cent) are in the Gippsland Basin (Victoria), where they are used for electricity generation. There are also substantial undeveloped resources in the Murray Basin. Australia's EDR of brown coal are sufficient for about 1022 years at 2014 production levels, which is an increase from 500 years at 2008 production levels.
Australia has the world's largest uranium resources, with reasonably assured resources of uranium recoverable at less than US$130/kg (equivalent to EDR) estimated to be 709 520 PJ (1267 kt U) at the end of 2015; this is equivalent to about 200 years at 2015 production levels. The increase from 2008 resource estimates of 651 280 PJ (1163 kt U) is a result of high levels of exploration. Australia also has a major share of the world's thorium resources, a potential future nuclear fuel.
Gas is Australia's third-largest energy resource after coal and uranium. Australia has significant conventional gas resources, lying mostly offshore in the Carnarvon, Browse and Bonaparte basins off the north-west coast of Western Australia; smaller resources exist in south-east (Gippsland Basin) and central Australia. Conventional gas EDR were estimated to be 186 200 PJ (169 trillion cubic feet [tcf]) at the end of 2014, which is a significant increase from 113 400 PJ (103 tcf) in 2011. At current production levels, this is enough conventional gas resources for 34 years.
Australia also has significant unconventional gas resources - coal seam gas (CSG), tight gas and shale gas. CSG resources are associated with the major coal basins in Queensland and New South Wales, with further potential resources in South Australia. Current EDR of CSG stand at 45 520 PJ (43 tcf), nearly three times the 2008 EDR estimate of 16 590 PJ (15.1 tcf). Many Australian sedimentary basins also have potential for shale and tight gas. In 2014, tight gas resources were estimated at around 48 714 PJ (44 tcf), up from 22 052 PJ (20 tcf) in 2011. Shale gas resources are now in the early stages of exploration, and their size remains to be defined. Contingent resources of 12 180 PJ (11 tcf) have been declared, with 80 per cent being in the Cooper Basin.
Australia's oil resources are in decline. Remaining crude oil total demonstrated resources are estimated to be 7066 PJ (1202 million barrels [mmbbl]), compared with 8414 PJ (1431 mmbbl) in 2008. Most of the remaining known crude oil is located in the Carnarvon, Bonaparte and Gippsland basins. Australia's total liquid petroleum resources are boosted by condensate and LPG resources. At the end of 2014, condensate resources were estimated to be 16 463 PJ (2800 mmbbl), compared with 16 170 PJ (2750 mmbbl) in 2008. LPG resources are associated with major, largely undeveloped gas fields in the Carnarvon, Browse and Bonaparte basins off the north-west coast of Australia. At the end of 2014, LPG resources were estimated to be 5957 PJ (1415 mmbbl), compared with 2008 resources of 6210 PJ (1475 mmbbl). Australia's oil resources could be extended by new discoveries in deepwater basins (both proven and untested) and further growth at existing fields. Without significant new discoveries of crude oil or development of condensate and LPG resources associated with offshore gas resources, or other alternatives, Australia will be increasingly dependent on imports for transport fuels.
Australia has significant demonstrated shale oil resources of around 84 435 PJ (14 360 mmbbl) that are currently not used. A demonstration plant at Gladstone produced its first crude oil in 2011. Some sedimentary basins also have potential for hydrocarbon liquids that are generally associated with shale and tight gas occurrences. These resources await further exploration and quantification.