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He said working with Liberty will facilitate improved well productivity and cost efficiency as Empire moves from the exploration phase into production.
As part of the fundraising campaign, the company plans to secure $39 million via a two-tranche placement at 16c per share. The initial tranche next week will raise about $30 million, while the balance will be subject to shareholder approval at a meeting to take place late next month.
The 16c share price is a 13.5 per cent discount to Empire’s closing share price last Friday and just a 9.3 per cent discount to its 15-day volume-weighted average price (VWAP) prior to a trading halt.
The company’s Carpentaria pilot project sits about 500km south-east of Darwin. Its 100 per cent-owned subsidiary Imperial Oil & Gas holds the biggest acreage position in the Beetaloo, with more than 113,000 square kilometres of ground.
Management’s key focus is on developing its Beetaloo contingent gas resource that already sits at a total of 1.63 trillion cubic feet (Tcf) of gas and 3.5 million barrels (MMbbls) of liquids for the mid-case.
The Beetaloo is a shale gas play, meaning the gas is hosted within shales instead of sandstone, such as in conventional operations. Shale has low primary porosity and permeability, so the company will “stimulate” the reservoir to induce microscopic-scale fractures extending away from the wells to facilitate gas flow up to the surface.
Empire is looking to sell gas into the NT, before tackling a chronic supply shortage on the east coast and its ultimate aim is to begin exporting.
The NT Government-owned Power and Water Corporation (PWC) supplies gas to the Top End and has had a long-standing contract with Italy’s ENI, which produces gas at its Blacktip field in the Joseph Bonaparte Gulf, south-west of Darwin. Blacktip is well-known to have struggled in recent times with its gas output, potentially opening the door for another local gas producer to step in and fill the void.
With a gas-market screaming for product all over the place, Empire could find itself in a commanding position should its Beetaloo-based project hit it big.
Is your ASX-listed company doing something interesting? Contact: mattbirney@bullsnbears.com.au
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