Empyrean Energy : Production and Sale of Gas from Dempsey 1-15 Well Commences

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Empyrean Energy PLC - EME Production & Sales from Dempsey Well Commences Released 07:00 17-Jan-2018

RNS Number : 0991C

Empyrean Energy PLC 17 January 2018

This announcement contains inside informa�on

Empyrean Energy PLC / Index: AIM / Epic: EME / Sector: Oil & Gas

17 January 2018

Empyrean Energy PLC ("Empyrean" or the "Company")

Produc�on and Sale of Gas from Dempsey 1-15 Well Commences

Empyrean Energy (EME: AIM), the oil and gas development company with interests in China, Indonesia and the United States, is pleased to announce that it has been informed by Sacgasco Limited (ASX: SGC) ("Sacgasco"), the operator of the Dempsey 1-15 well in the Sacramento Basin, onshore California, that produc�on and sale of natural gas from the Dempsey 1-15 well has commenced. Empyrean has a 30% working interest in the Dempsey 1-15 Well.

The Dempsey 1-15 well is flowing gas at a rate of approximately 140 mcf/day with a flowing tubing pressure of 670 pounds per square inch (psi).

Concurrently the applica�on process for the permi�ng of the enhanced reservoir s�mula�on of the well is proceeding as planned with s�mula�on opera�ons expected in the first quarter of 2018.

Empyrean CEO Tom Kelly commented, "This is a milestone achievement and with produc�on and gas sales now underway at Dempsey 1-15 crucial data on the quality of the reservoir will now be collated ahead of fracture s�mula�ng this zone. We have been informed by Sacgasco, the operator of the well, that the fracture s�mula�on planning and permi�ng has commenced in earnest and is proceeding smoothly with a view to commencing during Q1 2018. I look forward to providing further updates as they become available."

**ENDS**

The informa�on contained in this announcement was completed and reviewed by the Company's Execu�ve Director, Mr Gajendra (Gaz) Bisht, who has over 28 years' experience as a petroleum geoscien�st.

Notes to Editors

About Empyrean Energy Plc (LON: EME)

Empyrean is a London AIM listed oil and gas explorer with three poten�ally high impact new projects. Empyrean has a 1800km2 offshore oil permit located in the Pearl River Mouth Basin, China where it has completed 3D seismic in Q3, 2017 to further mature two large oil prospects, Jade and Topaz. Processing and interpreta�on is underway and preliminary internal interpreta�on of the raw seismic data has confirmed the structural validity of the Jade and Topaz prospects and also iden�fied a third significant target named Pearl, which is located north of Topaz. The permit is directly South East of the billion barrel+ Liuhua Oil Field operated by CNOOC and two recent discoveries to the permits West and South further enhance the merit of Jade and Topaz. Empyrean is operator and holds 100% of the explora�on rights through to commercial discovery where CNOOC have a back-in right to 51%.

Empyrean also has a 10% interest in West Natuna Explora�on Limited that holds 100% of the Duyung PSC in offshore Indonesia and is targe�ng the Mako Shallow Gas Discovery that has an independently verified 2C and 3C gas resource of between 430-650 Bcf recoverable gas. Successful tes�ng opera�ons were recently completed at the Mako South-1 Well with 10.9 million cubic feet of gas flow and be�er than expected reservoir quality and mul� Darcy permeability. The operator is currently analysing data with a view to providing a development plan.

Empyrean also has a joint venture with ASX listed Sacgasco Limited on a suite of projects in the Sacramento Basin, onshore California, USA. The package includes two mature, mul�-Tcf gas prospects, 'Dempsey' and 'Alvares', and an Area of Mutual Interest (the "Dempsey Trend AMI") that includes at least three already iden�fied, large Dempsey-style follow up prospects. Dempsey is a large structure mapped with 3D seismic and interpreted by Sacgasco to have the poten�al to hold a prospec�ve resource of over 1 Tcf of gas in up to seven stacked targetreservoirs. The joint venture has completed drilling of a 2,970 metre (9,747 fee) combined appraisal and explora�on well; Dempsey 1-15, to evaluate this prospect. Wireline logs confirmed numerous zones for produc�on tes�ng.

Aside from compelling technical merit, the Dempsey-1 well loca�on sits next to exis�ng gas metering and surface infrastructure that is owned by the joint venture. This will allow for any gas discovery to be tested and connected into the local pipeline at rela�vely low cost and in an accelerated �meframe. This early poten�al for short-term cash flow in the event of a commercial discovery would be significant for the joint venture and for the state of California where gas demand is high and approximately 90% of consump�on is imported from other states. Gas produced in the Sacramento Basin currently prices at a 10-15% premium to Henry Hub Gas Prices. The joint venture is currently tes�ng the Dempsey Prospect.

Alvares is a large structure mapped with 2D seismic and interpreted by Sacgasco to hold prospec�ve resources of over 2 Tcf es�mated poten�al recoverable gas. A well drilled by American Hunter Explora�on Limited in 1982 for deeper oil intersected 5,000� of gas shows. No valid flow test was conducted due to equipment limita�ons and the deeper oil target failing.

However minor gas flows to surface were recorded even with these limita�ons. The possibility of using the exis�ng well bore to sidetrack and get a valid flow test, thus reducing costs will be examined.

The Dempsey Trend AMI is an Area of Mutual Interest extending to approximately 250,000 acres and containing the Dempsey prospect (described above) as well as at least three other, Dempsey-style prospects which have been iden�fied on exis�ng seismic.

www.empyreanenergy.com

About Sacgasco Limited (ASX. SGC)

Sacgasco Limited (ASX: SGC) is an Australian-based energy company focused on conven�onal gas explora�on in the Sacramento Basin, onshore California. SGC has an extensive por�olio of gas prospects at both explora�on and appraisal stages, including mul�-Tcf opportuni�es. The Company is targe�ng gas supply to the local Californian gas market and burgeoning LNG market in North America. SGC is of the view that the size of the prospects in California have the poten�al to supply both the domes�c Californian gas market and export LNG markets.

www.sacgasco.com

This information is provided by RNS

The company news service from the London Stock Exchange

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n & Sales from Dempsey Well Commences - RNS