Cliff Head joint venture between Triangle Energy Global and Pilot Energy continues to deliver the goods with the duo completing its fourth tanker load of 26,500 barrels of oil onto the AB Paloma vessel at the Port of Geraldton in Western Australia.
Triangle Energy is the senior partner in the venture and says the ship is now stocked with 53,000 barrels of oil and is on its way to a refinery in Asia where it will be sold.
The work is all part of an ambitious new shipping play that will see the pair dispatch liquids from its Cliff Head oil field around 270km north of Perth to customers in South East Asia.
Triangle and Pilot Energy recently established the route as a means of circumventing energy powerhouse BP Australia’s decision to discontinue oil handling and refining activities at its Kwinana facility in WA – a decision which left a raft of producers scrambling to get their product to market.
The pair navigated the facility’s closure by establishing a new export route for its Cliff Head oil through a newly formed facility at the Port of Geraldton.
The delivery forms part of the duo’s Cliff Head JV, or “CHJV” operation – a corporate tie-up that includes the Arrowsmith stabilisation plant, well infrastructure and a handful of federal and state pipeline licences.
Over the past few months Triangle and Pilot have proven up the new route’s feasibility through a maiden tanker export and the duo are now focused on streamlining the economics of the path following its second freight
Triangle Energy Global Managing Director, Conrad Todd said:“The Truck to Tanker export route is now established and the CHJV is now focussing on streamlining and reducing operating expenses for this export route. The second tanker export run to Asia has established that we can continue exporting and selling the oil produced from the Cliff Head oil field for the foreseeable future as we progress plans on the future utilisation of the Cliff Head facilities.”
Triangle currently maintains a 78.75 per cent stake in the CHJV whilst Pilot mops up the 21.25 per cent balance, however the structure of the deal could soon change following recent talks.
In early October the pair announced plans to re-jig the JV with Triangle agreeing to sell off half its rights for a cool $1 million. The deal is set to come into play by the second quarter of next year depending on the outcome of a government review of the duo’s proposed carbon capture and sequestration plan for the Cliff Head oil field.
The partners are currently producing roughly 700 barrels of oil each day at Cliff Head operation however they also plan to use the site’s sub-surface oil reservoirs to store carbon once the field’s hydrocarbon reserves have been exhausted.
Triangle says the pair currently host a contingent carbon dioxide resource of around 6.4 million tonnes with the ambition of loading or “sequestering” the substance underground at a ratio of around a million tonnes per year over 13 years following the end of Cliff Head’s oil production.
Once finalised, the ownership structure will be reformatted instantly, leaving Pilot in the driving seat of the CHJV’s current oil production initiatives and future carbon capture and sequestration programs.
Triangle believes the plan could significantly extend the shelf life of the CHJV’s infrastructure and yield a net present value of up to $210 million.
The price of Brent crude oil is currently trading at around $97 per barrel, rising over the past few days amidst increased demand from China – the world’s most prominent importer of the liquid.
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