Conduit Power and Riley Exploration Permian expand JV for Texas power projects

TAGS

Conduit Power, LLC, and Riley Exploration Permian, Inc., have announced definitive agreements to broaden the scope of their joint venture (JV), RPC Power, LLC. This expansion is set to increase RPC Power’s operations in power generation and storage, directly supplying the Texas power grid operator, ERCOT. The partnership aims to deploy 100MW of natural gas-fueled generation alongside battery energy storage systems across multiple facilities in West Texas, with these assets expected to be operational throughout 2025.

Strategic Enhancement of Joint Venture Operations

Originally established in March 2023, RPC Power was designed to manage power generation assets utilizing the natural gas produced by Riley Permian for powering its oilfield operations in Yoakum County, Texas. The revised scope of the joint venture now also includes the sale of dispatchable power and ancillary services to ERCOT, marking a significant shift towards broader energy market engagement.

See also  Hindalco Industries to build battery foil manufacturing facility in Odisha

Increasing Investment and Ownership Stakes

In line with the expanded joint venture agreements, Riley Permian has upped its stake in RPC Power from 35% to 50%. This adjustment reflects its commitment to the venture and the strategic importance of the project. Additionally, Riley Permian will provide up to 10 million cubic feet per day (MMcf/d) of natural gas as a feedstock for the power generation facilities, highlighting the synergy between Riley’s natural gas production and RPC Power’s operational needs.

Comments from Company Executives

Travis Windholz, Managing Director at Conduit, emphasized the strategic importance of the expansion, “Our JV expansion at RPC Power represents a significant milestone for our company, and we are proud to build upon our successful partnership with Riley Permian. Conduit’s decentralized generation approach and focus on modularity prioritize grid resiliency, flexibility, and profitability in a rapidly changing power landscape.” He also noted the environmental benefits of upgrading to more efficient mobile engine technology which aids in reducing emissions.

See also  FREYR Battery's Giga Arctic project receives major boost with €100m EU grant

Philip Riley, CFO of Riley Permian, shared his enthusiasm for the project, “We’re excited for this new phase of our power development effort with Conduit. This project aims to capitalize on West Texas market dynamics including abundant, associated natural gas production, gas midstream egress limitations, and shortfalls of dispatchable, reliable power. We see an opportunity to achieve value uplift with our natural gas, diversify our revenue mix, and invest in power markets with attractive fundamentals.”

See also  Sensata acquires energy storage systems manufacturer Spear Power Systems

Legal Advisors and Future Outlook

The expansion of RPC Power is supported by notable legal expertise with Sidley Austin LLP advising Conduit and Kirkland & Ellis LLP advising Riley Permian. As these companies move forward with their strategic plans, the enhanced capabilities of RPC Power are expected to contribute significantly to the stability and efficiency of power supply in the ERCOT market, while also fostering economic growth and sustainability in the region.

This joint venture expansion by Conduit Power and Riley Exploration Permian not only enhances their operational footprint in the Texas energy market but also sets a benchmark for integrating natural gas production with innovative power generation and storage solutions, potentially reshaping energy strategies in the region.

CATEGORIES
TAGS
Share This