Pilot Energy gets $6.5m tick from Canberra

Federal grant to help jump start Pilot’s Mid West carbon capture project

Pic via Getty Images

• Pilot Energy wins $6.5 million grant from Federal Government

• Grant to help Pilot progress engineering and technology demonstration activities

• Grant award follows milestone approval and support from Korean consortium

 

Special Report: Pilot Energy has just had another major win with the awarding of a $6.5 million Federal Government grant to support its export-focussed Mid West Clean Energy Project.

Momentum behind the MWCEP is building with the latest boost for Pilot Energy (ASX:PGY) closely following the announcement of the company securing the support of a consortium of Korea’s major power generation and energy companies.

That came after the Federal Government granting its first of its kind Declaration to allow offshore permanent carbon storage at the MWCEP last month. Pilot then announced a 370% upgrade to its carbon storage resources at its flagship project earlier this month.

The $6.5m grant has been awarded to Pilot under the Commonwealth Department of Climate Change, Energy, the Environment and Water’s (DCCEEW) Carbon Capture Technologies Program. Under this phase of the grant program the Commonwealth government is investing $65m across 7 projects with Pilot awarded 10% of the total available funding.

The first phase of the MWCEP provides carbon capture services to the Mid West Region of WA and the new funding enables Pilot to progress engineering and technology demonstration activities across three sources of carbon.

Across these sources, Pilot has initial potential to capture 200,000–300,000t of carbon per annum. This volume represents approximately 50% of the estimated volume required to support Pilot’s Cliff Head Carbon Storage Project.

Top 10 project

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 and it’s expected to allow for continuous injection through to 2050.

Executive Chairman Brad Lingo said: “This grant is another strong endorsement of our MWCEP and its ability to make a significant impact on emissions reductions in WA and some of Australia’s major APAC trading partners.

“This $6.5 million grant allows Pilot to continue to build momentum in the MWCEP following the recent declaration of storage formation and completion of the pre-FEED study.

“We are grateful for the broad support our application received from a range of parties.

“We look forward to working with the DCCEEW and Department of Industry, Science and Resources to close out the grant funding agreement over the next two months prior to commencing work on this important carbon removal initiative.”

To secure the grant funding Pilot collaborated with several partners including global frontrunners in carbon capture technology like Capture6, KC8, Svante, CarbonCo, and Genesis Energies, as well as Curtin University on carbon supply chain R&D.

The grant application was also supported by a broad range of industry and regional stakeholders.

Jump start for project

A priority initiative to be stepped up with the grant funds is Project Wallaby, a pilot facility that will demonstrate Capture6’s groundbreaking water processing and direct air capture system.

Capture6 is also an important partner for Pilot’s broader MWCEP as the successful demonstration of its technology has potential to materially reduce the cost and environmental impact of the project’s water handling system. The technology could also provide potential additional sources of clean energy related revenues.

Capture6’s CEO, Ethan Cohen-Cole said after the funding was announced: “Capture 6 is thrilled to work on this project with Pilot Energy. The MWCEP is a great example of how Capture6 is working with clients to use our carbon removal and water technology to enable and accelerate the energy transition."

How the MWCEP works

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.

This phase will also accelerate the drawdown of emissions from the atmosphere through Capture6’s DAC facilities tied directly to the MWCEP infrastructure.

Scheduled to launch in 2028, involves the MWCEP producing up to 1Mt of clean ammonia for export. Pilot is actively building 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 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.

Originally published as Pilot Energy gets $6.5m tick from Canberra