BP Singapore has agreed to offtake crude oil produced from the Cliff Head oil field, offshore W. Australia.
BP has signed a binding deal to buy the oil from the offshore oil field with the Cliff Head Joint Venture consisting of Triangle Energy and Pilot Energy.
Under the terms of deal, BP Singapore will purchase 100% of the crude produced from the Cliff Head Oil Field, commingled with crude and condensate of other producers (Designated Seller Groups), on FOB Kwinana terms.
Triangle Energy, will act as the operating agent on behalf of all of the Designated Seller Groups in relation to each of their offtake agreements and has entered into an agreement with each of the Designated Seller Groups to govern the provision of these services.
The offtake agreement will operate in tandem with the already executed Product Storage and Services Agreement (Storage Agreement) with
BP Kwinana.
The Designated Seller Groups have each entered into a Storage Agreement with BP Kwinana, operating together, pursuant to which the Designated Seller Groups have leased tanks at Kwinana, Perth, Western Australia for storing the Designated Seller Groups' crude oil and condensate on a commingled basis.
The initial term of the Offtake Agreement is aligned with the term of the Storage Agreement. The offtake is for the entire production quantity from the Cliff Head oil field, and pricing is at a fixed discount to Brent. BP Singapore has been granted a right to match any offers for the sale of Cliff Head Product sold on a standalone basis for a period of 3 years following the delivery period.
According to a statement released Thursday, the producers may be subject to penalties and liabilities if they, or another Designated Seller Group member, delivers off-specification product.
Based on current storage levels, the Cliff Head Joint Venture expects that the first lifting will take place in October 2021.