Pilot Energy gets 370% Carbon Storage resource boost

Special Report: Hot on the heels of the first of its kind declaration to enable offshore permanent carbon storage at Pilot Energy’s Mid West Clean Energy Project, the energy minnow has announced a 370% upgrade to its carbon storage resources.

The resource for the depleted Cliff Head offshore oil field licence area, which is a key part of the MWCEP, has increased from 9.7 million tonnes to 45.6 million tonnes (100% basis).

As well as enabling Pilot Energy (ASX:PGY) to make a significant contribution to emissions reductions in WA, the additional resource gives added impetus to the following phases of the MWCEP – the production of clean ammonia.

Pilot chairman Brad Lingo said: “Having secured Commonwealth Government approval of the Cliff Head Formation reservoirs for the safe and permanent injection and permanent storage of CO2, this 370% increase in storage resources and injection capacity means the Cliff Head Storage Project can be a material contributor to reducing safeguard facility emissions in Western Australia.

Pilot is keenly focussed on providing major CO2 emitters in the Mid West and South West of Western Australia with a real, near-term, permanent greenhouse gas emissions abatement solution.

“We’re working to demonstrate that the Cliff Head Carbon Storage Project can deliver a low-cost carbon abatement solution to industrial emitters, as well as demonstrating that the Mid West region with its abundant renewable resources is an ideal location for supporting climate repair through direct air capture.”

The updated storage resources result from work initiated during the Declaration application phase and engagement with the National Offshore Petroleum Titles Administrator and build on the recent approval.

Also noteworthy is that the Contingent Storage Resource has been classified as Development Pending which is the highest level of maturity, with the assessment completed in accordance with the Society of Petroleum Engineers Storage Resource Management System.

The resource upgrade includes the newly identified Illawong structure to the east of the Cliff Head platform, which has the same storage formations as covered by the Declaration and has received an initial prospective resource assessment of 50.4 million tonnes (100% Basis).

Conversion from prospective resource to a contingent resource is likely to involve punching an appraisal well during the initial drilling program of the carbon storage project.

Ideally suited and located

The key attributes of the Cliff Head Project that make it ideally suited to hosting a permanent store of carbon include its long-term operating history, stable geologic setting and a proven regional sealing formation – the Kockatea Shale – providing the ultimate seal at the offshore injection site.

The project is also within 15-30km of existing and planned emissions from industrial activity that needs permanent carbon emissions abatement to comply with Safeguard Mechanism legislation and is less than a day’s round trip via sea to service emissions from one of WA’s key industrial regions stretching from Kwinana to Bunbury.

Next steps

Pilot will now soon start the process of requesting an amendment to the Declaration to account for the increased volumes, as well as progressing the project’s Front-End Engineering Design and injection licence.

In a demonstration of the strong support for CCS in Australia and especially Western Australia, Pilot hosted an Austrade-supported delegation of major Korean companies at the MWCEP in May.

All delegates on the tour expressed active interest in CCS to reduce greenhouse gas emissions as a key means to support South Korea’s net zero targets as the country accelerates its clean energy transition.

This article was developed in collaboration with Pilot Energy, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.