Pilot Energy has announced that its agreements with Triangle Energy to farm out a part of an offshore exploration block in Western Australia and form a solar and wind joint venture (JV) have been terminated.

The company has decided to terminate the agreements due to refusal of approvals from an Australian regulator.

In November 2020, the parties had signed a sale agreement under which Triangle Energy will acquire an operating stake of 78.75% in the WA481-P block in the Perth Basin.

As per the agreement, Triangle Energy had agreed to fund an A$5.75m ($4.1m) work programme at the block for gaining the stake.

Another agreement at that time was signed with an intention to create a JV between the parties to consider developing a wind and solar power project centred around the offshore and onshore production facilities of the producing Cliff Head oil field.

During the initial feasibility study period of the renewable power project, Pilot Energy’s interest in the JV is 80%, while Triangle Energy holds the remaining 20% interest.

The closing of the sale agreement was subject to approval by a cut-off date from the National Offshore Petroleum Titles Administrator (NOPTA) for the preliminary transfer of an interest from Key Petroleum in the WA481-P concession to Pilot Energy and the subsequent transfer of it to Triangle Energy.

The JV agreement, in turn, was subject to the completion of the sale agreement.

The WA481-P block, which is operated by Pilot Energy, is directly adjacent to the Cliff Head oil field.

Last month, NOPTA had issued notices to Pilot Energy and Triangle Energy, stating that based on the information it had received, it planned to refuse approval of the transfer of stake.

The regulator stated that as the proposed transferee, Triangle Energy could not show enough financial resources to meet the obligations attached with the WA-481-P block.

Owing to the cancellations of the two agreements, Pilot Energy retains the operatorship of, and 100% beneficial interest in WA-481-P. It will also have operatorship and 100% ownership of the Cliff Head wind and solar project.

Besides, the company will retain a stake in the Cliff Head JV, which owns the Cliff Head infrastructure via its 50% interest in Triangle Energy Operations, the operator of the Cliff Head field.