14/09/2017 - 10:29

Empire production assets under receivership

14/09/2017 - 10:29

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Updated: Empire Oil & Gas has appointed voluntary administrators to its wholly-owned Empire Oil subsidiary, which controls its core Red Gully assets.

Empire production assets under receivership
Empire's Red Gully facility, which produces 10 terajoules of gas per day. Photo: Attila Csaszar

Updated: Empire Oil & Gas has appointed voluntary administrators to its wholly-owned Empire Oil subsidiary, which controls its core Red Gully assets.

Andrew Smith, Peter McCluskey and Martin Jones were appointed the voluntary administrators.

The Empire Oil & Gas subsidiary that controls its core Red Gully assets is in the hands of receivers after Mineral Resources last night sent the gas producer a default notice.

The facility, located in the Perth Basin, produces about 1 per cent of Western Australia’s domestic gas usage, or 10 terajoules per day.

Mineral Resources provided Empire with a $15 million working capital facility in August last year, which gave MinRes first ranking as a creditor over a number of assets held by Empire’s production subsidiary.

But MinRes last night issued a notice of default and demand and a deed of appointment of receivers and managers, with Matthew Donnelly and Jason Tracy of Deloitte appointed receivers.

The assets covered by the deed include the Red Gully-north exploration licence, two production licences, rights for future petroleum extraction, and control of buildings and improvements on the titles.

Empire has said it is considering its position.

It comes weeks after the company changed its managing director, with Ken Aitken, who held the role three years, replaced by Angus Walker.

At the end of August, Empire put its shares in suspension when it was unable to restart production at its Red Gully-1 well.

The well feeds the Red Gully processing plant.

Production had been paused for a reserves pressure survey, but the company was unable to restart flows, including through use of a nitrogen lift.

Empire shares remained suspended from trade today, but last traded at 12 cents each.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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