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Empire Oil And Gas Updates On Red Gully Gas Plant

Empire Oil and Gas (ASX: EGO) has sustained steady production periods from discovery well Gingin West-1, demonstrating the operability of the Process Control System of their recently commissioned Red Gully Gas and Condensates Processing Facility near Gingin in WA.

The Facility has been run on both the Red Gully-1 and the Gingin West-1 gas discovery wells and major equipment packages, being the Export Gas Compressor and Condensate Offloading package are fully operational.

Overall condensate production since commissioning is over 2842 barrels. This is being stored in tanks at the facility pending BP's acceptance of it. This requires the refinery operator to satisfy that it can safely accept the condensate into its Kwinana Refinery.

Until that acceptance the Facility cannot be run at full capacity because of the lack of storage available at the site.

Empire's testing of the current condensate production shows that it is within contractual specifications and Empire therefore anticipates BP's imminent acceptance of it.

As a result of this, Empire and Alcoa have agreed that the Delivery Start Date of post-commissioning gas be extended to 15 July 2013.

The Construction/Commissioning Camp has been demobilised as personnel numbers have reduced to operating levels of three, housed in Gingin.

Three well drilling program

Empire has submitted Applications to Drill, Drilling Programmes, Geological Prognoses,

Health and Safety Procedures and Environmental Plans for the Dunnart-2, Black Arrow-1 and Charger-1 wells in the North Perth Basin to the Western Australian Department of Mines and Petroleum.

The status of these is progressing with the Health and Safety settled for both Dunnart-2 and Black Arrow-1. The Environmental Plans have been re-lodged and progressing with the requested Amendments.

Empire is also progressing access agreements with all landowners and is in the process of settling drilling contracts with Drilling Contractors of Australia and DCA Rig 7.

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