Triangle Energy (ASX:TEG) closes over 16% strong today. Here’s why

Highlights

  • Cliff Head Joint Venture Signs Binding sales and purchase Offtake Agreement with BP Singapore.
  • As per the terms of the agreement, 100% of the crude oil produced will be purchased by BP Singapore, mixed with condensate and crude of other producers.
  • The Offtake agreement will be followed by the completion of the Storage Agreement with BP Kwinana.

A joint announcement was released on ASX announcing the Binding Offtake Agreement between Cliff Head Joint venture and BP Singapore.

Following the announcement, the shares of Triangle Energy Limited (ASX:TEG) increased by 16% with shares prices trading at AU$0.021.

Let’s take a closer look at the announcement.

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Binding offtake agreement with SP Singapore

The Cliff Head Joint venture (CHJV) that is held by Triangle (ASX:TEG) and Pilot Energy Limited (ASX:PGY) has signed a Binding Offtake Agreement with BP Singapore. The agreement includes the sale and purchaser of the crude oil produced by CHJV at the Cliff Head Oil Field.

As per the terms of the agreement, 100% of the crude oil produced will be purchased by BP Singapore, mixed with condensate and crude of other producers.

Triangle Energy will be the operating agent of all the Designated Sellers Group. Triangle has signed an agreement with each Designated Seller Group to manage the operational services.

As per the ASX announcement dated 22 April 2022, the binding agreement will be executed after the completion of the storage agreement with BP Kwinana.

The terms of the Offtake Agreement are aligned with the Storage Agreement terms. The Offtake Agreement covers the entire production from Cliff Head Oil Field.

BP Singapore gets the right to tie any offer on a standalone basis for selling the Cliff Head Product for 3 years only following the delivery period. The producers will face a penalty in case off-specification products are delivered by them or Designated seller Group.

Robert Towner, Managing Director of TEG,

Bottom Line

The Cliff Head Joint Venture signed an Offtake Agreement with BP Singapore for selling and buying crude oil that is produced at Cliff Head Oil Field. Triangle will be the Operating Agent as it signed an agreement with Designated Seller Groups to manage the services. The Offtake agreement will be followed by the completion of the Storage Agreement with BP Kwinana. 

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