Southern Pacific Petroleum is seeking Federal Government assistance to help keep its oil shale project in Queensland alive. SPP has asked Government to extend an excise rebate scheme worth $36 million a year on domestic sales of its naphtha product to include export sales.

SPP has so far been unable to fully access the excise rebate on domestic sales due to reluctance from Australia's major refiners to purchase the product from the company's experimental project at Gladstone. The company can only profit from domestic sales if it receives an excise rebate.

SPP has been the target of a concerted campaign by Greenpeace, which claims that the oil shale projects are among the world's most greenhouse intensive fossil fuels. SPP has argued oil shale deposits are so vast in Australia that they could help the country become self-sufficient and so deserves government support.

Cabinet yesterday met to deliberate whether to extend excise assistance to SPP's exports or mandate that Australian refineries use the product. Most industry insiders predict Treasury will reject the request for assistance from SPP.