Empire Energy Group Limited (ASX: EEG) Announces C-5H Drilling Success and New Financing
Successful C-5H Well Drilling
Empire Energy Group Limited (“Empire”) reports the successful drilling and capping of the Carpentaria-5H (“C-5H”) well. The well reached a total depth of 5,310 metres (17,421 feet), with all 3,310 metres (10,860 feet) of the horizontal section located within the Velkerri-B shale. Strong gas shows were documented throughout the drilling process, which was completed ahead of schedule in 41 days from spud to rig release on 27 December 2024.
Future Production Plans
Fracture stimulation and production testing for the C-5H well are scheduled to commence in early Q2 2025, following the Northern Territory wet season. The initial production testing is anticipated to yield IP(30) flow rates. Despite the delay in stimulation, the company asserts that this will not affect the timeline for gas sales from the Carpentaria Pilot Project.
Financing and Liquidity Improvements
Empire has executed new facility documentation with Macquarie Bank, enhancing its financial flexibility. This includes a $30 million R&D Facility and a $5 million Performance Bond Facility. The R&D Facility is based on estimated tax rebates under the Australian Government’s R&D Tax Incentive Scheme and aims to support exploration and development activities associated with the C-5H well.
Empire’s current cash reserves stand at $25.7 million, with an additional $28.8 million undrawn under the new Macquarie facilities. The completion of these facilities is anticipated to mitigate potential equity dilution for shareholders.
Motley Fool contributor Lianne Eastty has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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