Oil Reservoir Detector
Oil Reservoir Detector is the only device in the early game that can detect oil deposits. It is a cheap device which can be used to scan for oil in a thin column below you by right clicking anywhere.
Crafting
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Usage
The range it scans in is small (approximately 8 blocks). The best method for finding oil is to move through every chunk in an area, scanning for oil constantly until the device sends the "Oil detected nearby" message. The oil can be extracted from the deposit blocks as 
crude oil.