Oil shale – rock containing micro-fossils which release oil when heated – was discovered in Tasmania in 1851, mainly in a belt stretching from Latrobe to Quamby Brook. The oil shale has been investigated as a potential source of hydrocarbons and for use as road bitumen. There was some prospecting and in 1861 a company was formed in Hobart to manufacture 'parafine oil', but with no result. Interest waned, until in 1908 the Tasmanian Shale and Oil Syndicate of Adelaide sank shafts at China Flats, erected retorts and produced 20 tonnes of oil, but it closed in 1914 due to insufficient capital.
Interest grew in 1920, after the federal government announced a reward for the discovery of a payable oil deposit. Many syndicates and companies were formed and retorts were set up. In 1922 the Tasmanian Cement Company opened a mine and erected a retort to provide fuel for its cement works at Railton – unsuccessfully. In 1930 the state government urged all companies to amalgamate. Sixteen holes were drilled, a Crozier retort was set up, attempts were made to produce asphalt and bitumen, but again with no real success. There has been sporadic investigation since 1939.
Further reading: C Bacon, 'The Mersey Valley oil boom of the 1920's', Mineral Resources Tasmania Report 1994/21, 1994; and 'A summary of the oil shale resources of Tasmania', unpublished report, Mineral Resources Tasmania, n.d.