Pilot Energy Raises $6.3M and Expands Carbon Storage Resource to 72 Million Tonnes

Major Resource Expansion at Cliff Head

Pilot Energy Limited (ASX: PGY) has revealed a significant upgrade to its carbon storage capabilities at the Cliff Head Carbon Storage Project, with the 2C contingent resource swelling by 58% to 72.2 million tonnes of CO2 equivalent. This leap, confirmed by subsurface consultant CO2Tech, reflects enhanced geological modelling and a refined understanding of the storage formation, positioning the project at the forefront of Australia's offshore carbon storage initiatives.

The expanded resource base not only strengthens Pilot's carbon management credentials but also underpins the company's broader Mid West Clean Energy Project (MWCEP), which aims to integrate carbon storage with clean ammonia and hydrogen production.

Innovating with Direct Air Capture Technology

In a strategic move to diversify its clean energy portfolio, Pilot has entered into a joint development agreement with Capture6 Corp to deploy Direct Air Capture (DAC) technology at the MWCEP. The initial phase, slated for 2025, involves demonstrating Capture6's water processing and DAC systems at the Arrowsmith site. This initiative, supported by a $6.5 million Commonwealth Carbon Capture Technologies Program grant, could reduce water treatment costs and open new revenue streams through carbon removal credits.

Project Wallaby, the joint venture underpinning this collaboration, outlines a phased approach with ambitions to scale atmospheric carbon removal from 80,000 tonnes per annum in the late 2020s to 350,000 tonnes by 2030 and beyond.

Capital Raising and Korean Consortium Support

Financially, Pilot has fortified its position by raising $6.3 million through a combination of equity placement and convertible notes, with additional convertible note funding of $2 million pending shareholder approval. This capital injection is critical for advancing project development and regulatory approvals.

Complementing these efforts, the Korean Consortium, comprising Korea Southern Power Co. (KOSPO), Korea East-West Power, and Samsung C&T, secured approximately A$2.2 million from the Korea Export-Import Bank to support feasibility studies for the MWCEP. This partnership underscores international confidence in Pilot's clean energy vision and aims to facilitate blue hydrogen and low-carbon ammonia production for the Asian market by 2030.

Regulatory Progress and Environmental Stewardship

Pilot continues to engage proactively with Australian regulatory bodies including NOPTA, DCCEEW, and WA's Department of Water and Environmental Regulation. Notably, the company has completed flora and vegetation surveys with the involvement of Aboriginal Rangers from the Yamatji Southern Regional Corporation, blending traditional knowledge with scientific assessment to inform environmental impact studies.

These steps are integral to securing the necessary approvals for the MWCEP and demonstrate Pilot's commitment to sustainable and responsible project development.

Outlook and Strategic Positioning

With a robust resource base, innovative technology partnerships, and solid financial backing, Pilot Energy is well-positioned to advance Australia's clean energy transition. The company's integrated approach, leveraging existing offshore infrastructure for carbon storage and clean ammonia production, could serve as a model for scalable, low-carbon industrial projects.

However, the path ahead involves navigating complex regulatory landscapes, securing further project partners, and successfully commercializing carbon storage and hydrogen production at scale.