Pilot Energy gets initial $3m carbon capture funds

Pilot Energy receives initial $3 million in Commonwealth grant funding to progress carbon capture at Mid West Clean Energy Project
The initial grant funding forms part of the total grant funding of $6.5 million announced last month
Pilot will now accelerate planned activities at the MWCEP aimed at providing carbon capture services to the Mid West region of Western Australia

Special report: Pilot Energy has banked its initial $3 million in Commonwealth grant funding to move forward with its carbon capture ambitions in Western Australia’s Mid West.

The cash injection is part of a $6.5 million commitment announced on 23 July that will turbocharge Pilot (ASX: PGY)’s broader and industry-leading Mid West Clean Energy Project.

The remaining funds will be received over the next four years from the Department of Climate Change, Energy, Environment and Water under its Carbon Capture Technologies Program.

With a total of more than 67Mt of potential storage capacity (3C contingent resource), the carbon storage component of the MWCEP will be among the top 10 carbon storage projects globally.

Thanks to the fresh injection of funds, Pilot will now accelerate engineering and technology demonstration activities aimed specifically at providing carbon capture services to the Mid West region of Western Australia.

Direct Air Capture

DAC is an engineering process that does what trees and plants do in nature – removing CO2 directly from the atmosphere.

One of Pilot Energy’s specialist partners is DAC technology provider Capture6 (6 being the atomic number for carbon). The US-based company has developed proprietary technology that uses a liquid sorbent to soak up CO2 from ambient air (atmospheric air in its natural state).

Capture6 recently proved its credential by receiving an award from the US Department of Energy to help make its DAC process even more efficient and less energy-intensive.

The company was also named the winner of the World Water Challenge 2023 in South Korea, an international contest for water solutions, and in January signed an MoU to develop a pilot facility with K-water, the government agency that provides public and industrial water in South Korea.

The successful demonstration of Capture6’s technology has strong potential to cut capital and operating costs of the MWCEP’s ammonia production facility, as well as reduce its environmental impact. During the Front-End Engineering and Design study to start soon, Capture6 and Pilot will investigate commercialising the fresh water produced by the demonstration phase equipment.

Pilot will also start other DAC pre-deployment analysis.

Hard to abate emissions

Another key initiative that will get under way is the carbon supply chain pre-FEED study. This will assess an emissions management service for a key Mid West region industrial facility, from the point source through to delivery to the MWCEP.

The assessment will give Pilot and the emitter a platform to progress commercial negotiations on a carbon management agreement.

Pilot’s chairman Brad Lingo said: “We are grateful to receive the support of the Commonwealth Government enabling Pilot to accelerate activities at our MWCEP.

“The Carbon Capture and Storage Project at Cliff Head provides the foundation for the MWCEP. We are working with leading global technology providers to ensure we employ the best carbon abatement solutions to deliver value for our shareholders.”

MWCEP at a glance

The MWCEP’s first phase will capture and store CO2 generated by the project’s ammonia production process as well as CO2 emissions from third party emitters.

Set to launch in 2028 is the second phase which involves the MWCEP producing up to 1Mt of clean ammonia for export. Last month Pilot secured the support of a consortium of Korea’s major power generation and energy companies, the “K-Consortium”, which aims to secure a major stake in the MWCEP.

Pilot continues to actively build relationships in markets such as South Korea, which is aiming for a 7.1% ammonia and hydrogen energy mix by 2036 as part of its net zero goals.

The MWCEP project has also been designed to incorporate the future supply of clean hydrogen into WA’s domestic energy market.

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.