Empire Energy could kick start first gas sales this year

First gas could be delivered from the Beetaloo Basin this year as Empire Energy prepares to start production. Read what’s next.

Empire Energy's Alex Underwood at the site of the Carpentaria 1 well in the Beetaloo Basin in the Northern Territory. Supplied

With a successful capital raising out of the way, major Beetaloo Sub-basin developer Empire Energy is within sight of first gas production and sales - possibly as early as this year.

Targeting $20 million, the share placement secured $28 million from institutional and other investors at $0.16 a share.

With a further $3 million expected when the offer is extended to smaller shareholders this week, as well as a $250,000 directors’ contribution, Empire has in excess of $30 million capital to invest in its latest drill and production plant.

With a visit to Empire’s Carpentaria project site scheduled for next month, Empire Energy managing director Alex Underwood said he hoped additional cash generated by the placement would speed up development of the processing plant.

“This has fully funded us for the fractured stimulation and flow testing,” Mr Underwood said.

“Now we have some additional funding in place for the gas plant and a pretty nice working capital buffer while we do the work.”

Empire Energy’s managing director Alex Underwood meets with Northern Territory contractors at the company’s Carpentaria well pad. Credit: File.

Fracking is expected to take about three weeks and, when drilled, the 3km horizontal seam will not only be the biggest ever at the Beetaloo, but also the largest ever drilled in Australia.

It will also be the first well drilled for a five-and-a-half-inch casing - an inch diameter increase in the four-and-a-half-inch casings used in previous Carpentaria drills.

“This allows us to apply more fractured stimulation horsepower and pump more sand and more water, so this will be our first ever full-scale pilot development well,” Mr Underwood said.

“The stimulation will take about three weeks, then we’ll shut the well for soaking, which is a production enhancement mechanism. After a period of several weeks soaking we’ll do a 30-day flow test and we expect results by the end of the third-quarter (September).

“Then we’ll shut the well back in and put it out for sales once we build the gas plant. We’re hoping to commence sales by the end of 2025 or early 2026.”

Resources Minister Madeleine King. Picture: The West Australian

First sales will be to the McArthur River Mine to shore up production supplies at the zinc and lead mine, with Darwin electricity consumers next to benefit when the 10-year gas sales agreement struck by former chief minister Eva Lawler is activated.

Investor confidence in gas was boosted earlier this year when federal Resources Minister Madeleine King released the Labor Government’s Future Gas Strategy.

During the federal election campaign Prime Minister Anthony Albanese began to incorporate gas into his energy language along with renewables, hydro and batteries.

In addition to Empire’s fundraising, Tamboran Resources also raised $85 million through a recent private investment in public equity arrangement.

After about a decade securing deals to get its patch of the Beetaloo Basin into production, Mr Underwood has seen a surge of interest in the vast gas reserve.

“I‘m very excited to see increasing levels of activity right across the basin,” Mr Underwood said.

“This year we’ve seen Tamboran say they’re going to be drilling another three wells and we know Santos is going to be carrying out an appraisal drilling program next year.

“This is the period of ramp up that we’ve all been waiting for. In terms of the results coming out of the field, it’s really starting to attract global interest in the basin.

“The global oil and gas industry has known for some time that there’s a huge volume of gas sitting in the shales of the Beetaloo. They are now starting to see flow rate results that are of significant interest to them.”

Originally published as Empire Energy could kick start first gas sales this year