Exactly one month ago, on Jan. 23, news leaked that a gigantic new shale oil field had been discovered… right in the middle of nowhere.
The location is a secluded town in southern Australia – Coober Pedy. It's about 850 kilometers north of Adelaide. The population is only 1,695 people.
And it's about to become an immense "ground zero" for a fast-approaching and highly volatile showdown over international energy.
Details are still forthcoming. But here's what we know so far.
Coober Pedy and the Arckaringa Basin
The rock formations underneath Coober Pedy hold some of the richest in oil and gas anywhere on earth. They're part of the Arckaringa Basin.
The Arckaringa Basin is an untapped shale oil field estimated to hold as much as 233 billion barrels of oil equivalent, according to independent petroleum industry consulting firm Gustavson Associates.
That's more oil than anywhere in America. It's more than all of Iraq, Iran, Canada, or Venezuela. It could even be more than what world energy leader Saudi Arabia really has.
As for what it's worth – industry estimates set the value of this unconventional find at as much as $20 trillion.
"This is one of the largest discoveries we've seen in the last 40 or 50 years worldwide," said Money Morning Global Energy Specialist Dr. Kent Moors. "It's a bona fide redrawing of the global energy map as we know it. This fundamentally changes the dynamics of energy."
Indeed, as Asia tries to wean itself off coal energy and Iranian oil, that region is going to be its biggest customer for Arckaringa oil.
This find is great news for Australia.
State Mineral Resources Development Minister Tom Koutsantonis described it as "a key part to securing Australia's energy security now and into the future."
Translation: Thanks to the Arckaringa Basin, Australia will remain energy self-sufficient and even become an oil exporter.
Arckaringa Basin Profit Opportunities
The find is even more exciting for energy investors.
Kent explained: "This oil find will change the world's geopolitical alignment – and benefit individuals, as well. Simply put, an oil find of this magnitude makes fortunes – many times over."
One tiny oil company based in Brisbane has 100% control of that the Arckaringa Basin: Linc Energy Ltd. (AXS: LNC). The firm has already invested $130 million in the initial drilling of several exploratory wells here. That's small potatoes for major oil companies, but Linc happens to be tiny, with a market cap of just over $1 billion USD.
For investors, Linc is the obvious play. But it may not be the most profitable one, according to Kent.
For one thing, the stock has already made a big move. When confirmation of the enormity of the find leaked, Linc shares soared 30%.
"We didn't expect it to go this nuts," CEO Peter Bond told Reuters.
No doubt there's more to come, once production gets going. But for the small-cap firm to begin well production (set for early 2014), they have to nail down one thing first – and that's where the real blowout opportunity is for energy investors, Kent told us.
You see, Linc needs help to get the oil out. They've publicly admitted this; they can't get this kind of haul out of the ground without a lot of help – both monetarily and in terms of technical expertise. So Linc is on the hunt for a partner. And they've hired Barclays bank to help them with the search.
This has caused tremendous excitement in the OSP sector – "operators and service providers."
That's where the money actually begins flowing, Kent explained, well before any oil comes out of the ground. And they're absolutely vital if Linc is to start sucking its potential $20 trillion haul out of the ground.
Kent has targeted two companies in the OSP sector that he thinks will go after the Arckaringa project. They're both traded on the NYSE.
See the video below for the complete story.