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Lake Mungo: has Australia completely forgotten about its best and scariest home-grown film?

If you were told to go and watch the scariest movie ever, you might expect to be pointed toward an acknowledged classic like William Friedkin’s The Exorcist, or even an upstart contender like Ari Aster’s Hereditary. What you probably wouldn’t expect is a small-scale mournful tale about grief and loss in Victoria’s rural city of Ararat. And yet the 2008 Aussie indie Lake Mungo is the recipient of just such accolades, the centre of a micro viral content industry that has labelled it the scariest, saddest, most devastating, and best ghost film you’ve never seen.

If Jennifer Kent’s The Babadook has become a national treasure, Joel Anderson’s Lake Mungo is the major contemporary Australian horror film all but unrecognised in its home country.

It makes for a dispiriting case study in the dysfunctions of local film distribution – after a 2008 premiere at the Sydney film festival, and a hobbled limited release in capital cities, the film left little trace, and is now absent from all local streaming services but iTunes.

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Promising first-time writer-director Anderson never made another feature film. Meanwhile internationally, the film sold for a never-made US remake, and then settled into a long afterlife as a treasured cult object and snowballing “have-you-seen-this?” internet sensation. In May this year its passionate UK fanbase was the beneficiary of a deluxe, limited edition Blu-ray through specialist distributor Second Sight; in Australia its DVD through local outfit Madman is out of print.

The story unfolds in the aftermath of the drowning of secretive Ararat teenager Alice (Talia Zucker) in a local dam, as her dad, Russell (David Pledger); mum, June (Rosie Traynor); and brother Mathew (Martin Sharpe) try to comprehend the events that led up to her death, and begin to suspect she’s not all-the-way-gone. Canny viewers may note some strategic borrowings from David Lynch’s Twin Peaks – the surname of our waterlogged teen is Palmer.

It’s all set up in a documentary style, like something you would run across late-night on the ABC. This found-footage format saw it slotted into the run of post-Blair Witch horror movies of the late 2000s, like the 2007 franchise-starters Paranormal Activity and [Rec].

It’s easy to see why a savvy but under-resourced film-making team would go this route – it’s low cost to produce, there’s a clear commercial niche, and low-res video provides the perfect murky visual field to stage some spooky jump scares. But with one exception, Lake Mungo largely foregoes shocks in favour of a spine-tingling atmosphere of dread. The film-makers don’t rest on the format as a vehicle for cheap thrills – this is the rare low-budget spooker that convincingly doubles as a portrait of bereavement.

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When Alice’s spectre starts turning up in family photos and home videos, the Palmers turn to a local radio psychic to make sense of these ghostly apparitions. The film then self-reflexively becomes about the nebulous proofs of supernatural phenomena made possible through camera technology, and about the mindset of the audience that buys into them.

But Anderson has yet more cards up his sleeve, and offers answers only to expose deeper questions. It’s clear he set out to deliver a real movie, with patient plotting, dramatic revelations, and defined character arcs. Even more remarkably, the cast and crew managed all this without a typical script – in pursuit of documentary authenticity, they shot with little rehearsal or blocking, working from detailed scene breakdowns, with Anderson eliciting dialogue by posing as the behind-camera interviewer.

Eventually Lake Mungo winds its way to a climax at the titular archaeologically significant site in far-west NSW, and to one last revelation about Alice’s final days. Here the film delivers its big horror movie moment, and it is a doozy – eerily strange and blood-curdling enough to set off that wave of YouTube explainer vids and fan dissections.

But what’s special about this scene is that it finally re-frames Alice’s fate not as a mystery to be broken open and picked apart, by the viewer or even by her loving family, but as something cosmically unfathomable, and terribly personal.

Unlike so many of the dead-teen-girl narratives that litter contemporary media, Lake Mungo lets its absent heroine keep some secrets in her grave.