Triangle Energy Global will bank almost $17 million from the latest oil sales from its share in the Cliff Head oilfield, offshore Dongara in Western Australia, after lifting more than 140,000 barrels of oil in the last output to be sold through BP’s Kwinana oil terminal before it is converted into a clean energy hub. Triangle shares the Cliff Head joint venture with Pilot Energy.
The CHJV’s final lifting from Kwinana to BP Singapore was 139,992 barrels of oil or “bbls” sold at US$105.2/bbl and 8,287 bbls fetching US$75.70/bbl, bringing in a total of US$15,361,516 or A$21,335,439 at a 72c exchange rate. The equity split is 78.75 per cent to Triangle and Pilot 21.25 per cent. The oil price is currently pushing US$120/bbl.
In October 2020, BP sent shockwaves through WA energy circles when it announced it would shut the Kwinana refinery after 65 years of operation, affecting virtually every onshore oil producer in the state.
According to BP, regional oversupply and sustained low refining margins means the Kwinana refinery is no longer economically viable. Having explored many possibilities for the refinery’s future, the company concluded the conversion to an import terminal is the best option.
Securing alternate export channels has been a challenge for the industry. The Cliff Head partners decided to increase capacity by refurbishing storage tanks at the Arrowsmith Stabilisation Plant and export to south-east Asian markets via Geraldton.
Since the final lifting to BP, the joint venture has been producing into the overhauled tanks and when full, the oil will be trucked to the Port of Geraldton for loading into a chartered tanker.
Triangle says its last Kwinana oil sale took full advantage of the current high prices.
Triangle Energy Managing Director, Conrad Todd said: “This will allow the CHJV to progress our exploration and production activities at Cliff Head, including the upcoming workover of the CH 10 well. In addition, this cashflow will facilitate the 3D seismic and exploration of our L7 permit.”
Triangle management has previously described the two permits as the jewel in the crown of the company’s asset base as it gradually moves away from the oil production and significant decommissioning costs associated with Cliff Head into cleaner burning gas.
The company is in the process of soaking up the balance of the interests it doesn’t already own in the two permits in the northern section of the Perth Basin. The L7 permit contained the shallow, historic Mt Horner oilfield that has largely been decommissioned.
However, Triangle has its sights on deeper gas fields along the route of the Dampier-to-Bunbury natural gas pipeline in the Perth Basin such as the large Waitsia, Senecio, Walyering, West Erregulla and Lockyer Deep gas fields. The 117 million cubic feet per day flow rates from Lockyer Deep were among the highest recorded in Australia.
The recent 3D survey was shot using low impact vibroseis trucks set up in the area after local farmers had finished cropping and other sensitive agricultural activities. Whilst complete processing of the seismic data is expected to take four to five months, the company believes a fast-tracked seismic model will be available sooner, enabling Triangle to start its interpretation and prospect generation earlier.
As Triangle shifts its focus onshore and into gas exploration, the company will revert from 78.75 per cent ownership to a 42.5 per cent stake in a move that will slash Triangle’s abandonment liabilities for the offshore oil field and associated assets.
The assets include the Cliff Head oilfield, wellhead platform and the Arrowsmith oil processing facility. Pilot will become operator of both the CHJV and the associated carbon capture storage proposal, although Triangle will continue its technical management of the joint venture until oil production stops.
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By Matt Birney
