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Empire Oil And Gas Close To Reaching Condensate Loading Agreement With BP Australia

Empire Oil and Gas (ASX: EGO) expects to soon settle a draft agreement with BP Australia to load condensate from the Red Gully and Gingin West wells into the BP Kwinana Refinery.

This will involve Empire adopting BP's revised Safety Procedures, enabling the refinery to safely accept the condensate.

Importantly, it will allow the Red Gully Gas and Condensate Processing Facility to run at full capacity.

Production at the facility is currently limited due to the lack of condensate storage with offtake partner Alcoa providing the Empire-led EP389 Joint Venture an extension of the time for delivery start to 12 August 2013 from 29 July 2013.

Empire has previously tested the current condensate which shows that is it within the contractual specifications.

During the last week, the company took the opportunity to conduct the planned service on the Export Compressor and also a section of the metering facility and implementing improvements to the condensate handling section.

The overall condensate production since commissioning is 5,047 barrels as of 25 July.

Empire had recently completed the data acquisition phase of the Wannamal Heliseismic Survey, which will rank a number of prospects adjacent to the Facility in order of their prospectivity.

These prospects have potential estimated recoverable gas of 205 billion cubic feet and 9.2 million barrels of condensate.

The company's three well in the North Perth Basin is currently approval by the Western Australia Department of Mines and Petroleum.

The Health and Safety application has been settled for the Dunnart-2 well in EP437 and Black Arrow-1 well in EP432.

Land Access Agreements are continuing with landowners along with rig contracts.

Dunnart-2 is anticipated to be the first well to be drilled with all approvals near completion.

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