How Pilot Energy Is Transforming Cliff Head Into a Carbon Storage Powerhouse

Cliff Head Transition and Compliance

Pilot Energy Limited has advanced its strategic pivot from oil production to carbon storage at the Cliff Head Oil Field, located offshore Western Australia. The company has focused recent operations on regulatory compliance and asset integrity, preparing the site for potential future decommissioning while simultaneously repurposing infrastructure for carbon capture and storage.

Key mandated activities under NOPSEMA’s General Direction 1947 have been completed, including securing wells and pipelines post-production. Ongoing environmental risk management remains a priority, with regular inspections confirming the integrity of offshore pipelines and facilities. Innovative inspection techniques, such as the use of Autonomous Underwater Vehicles (AUVs), have improved efficiency and cost-effectiveness in monitoring subsea assets.

Resource Upgrade and Exploration Plans

In a significant development, Pilot announced a major upgrade to prospective resources within its WA-481P permit. The Leander gas prospect’s mean estimate now stands at 1,116 billion cubic feet (Bcf) of gas and 18 million barrels of condensate, while associated oil prospects have been upgraded to 66 million barrels. These resources could underpin long-term low-carbon ammonia production, leveraging existing infrastructure.

To further mature these prospects, Pilot is planning a 3D seismic survey and exploration drilling, supported by ongoing environmental planning and stakeholder engagement. A formal farm-out process has commenced to attract partners to fund near-term exploration activities.

Corporate Moves and Capital Raising

Strategically, Pilot completed the first stage of acquiring 100% ownership of the Cliff Head Oil Joint Venture assets from Triangle Energy Group, enabling full control over onshore facilities and offshore infrastructure within Western Australian state waters. The transfer of remaining offshore interests in Commonwealth waters is pending regulatory approval.

Adding momentum to its carbon storage ambitions, Pilot received a non-binding proposal from a foreign state-owned enterprise to acquire a meaningful minority stake in the Cliff Head Carbon Storage Project. While the proposal aligns with Pilot’s commercial expectations, it remains subject to finalization.

Financially, Pilot bolstered its liquidity through a $5 million equity placement and a $1.8 million convertible note facility, raising a total of $6.8 million. Additionally, the company has lodged a Petroleum Resource Rent Tax (PRRT) refund claim of up to $4.5 million related to abandonment and decommissioning expenditures following the cessation of oil production at Cliff Head. This refund, expected in the September quarter, alongside anticipated proceeds from the sale of the Three Springs Solar Project, is set to provide significant capital for the Mid West Clean Energy Project.

Outlook and Strategic Implications

Pilot Energy’s integrated approach, combining resource upgrades, infrastructure repurposing, and strategic partnerships, positions it at the forefront of Australia’s energy transition. The company’s ability to maintain regulatory compliance while advancing carbon storage initiatives reflects a pragmatic balance between legacy operations and future clean energy opportunities.

However, uncertainties remain around the finalization of joint venture agreements, exploration success, and timing of capital inflows. The company’s ongoing efforts to secure additional funding and partners will be critical in sustaining momentum and delivering on its ambitious clean energy objectives.