Empire Energy (ASX:EEG) has confirmed its receipt of agreement for a total $65 million funding from Macquarie as it develops the North Territory’s Beetaloo.
Shares in the often thinly traded stock jumped 2.4% in response to the news in the first hour of trade. The $65M deal ultimately reflects a more than twentyfold expansion of an existing $2.25M facility.
One A$30M R&D facility will fund exploration and development while a second $30M facility will allow for construction of a gas plant on-site.
A further $5M is to satisfy NT government requirements for an environmental bond.
The funds will in aggregate ultimately go towards building out the company’s Beetaloo project, named after what it overlies: What the NT government hopes is Australia’s next big gas basin.
Carpentaria-5H is the flagship well of interest to Empire’s geotechs, with that recently spud asset currently at around 770m of measured depth as at Wednesday.
The fracking well project will ultimately shore up confidence – or erode it – in the area overlying the Beetaloo where Empire has set up its rig.
In management’s view, the deal with the fifth big bank ensures shareholders see “significantly reduced dilution.”
“The financing package with Macquarie announced today followed an extensive competitive tender process and provides Empire with the best terms currently available in the debt market,” Empire MD Alex Underwood said.
(Fun fact: The big Mac has been funding Empire for 15 years, he added.)
“This financing package, along with existing cash resources, will fund the drilling, completion and flow testing of C-5H and the installation of the Carpentaria Gas Plant.”
All cards in order: Empire is set for pilot production from the Beetaloo Basin in CY2025.
EEG last traded at 21.5cps.
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