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Empire Oil & Gas Progresses Construction Of Red Gully Gas Plant

Empire Oil & Gas (ASX: EGO) has made good progress on construction of the Red Gully Gas & Condensate Processing Facility in the Perth Basin.

Prior to Christmas, the condensate storage tanks and produced water tanks associated pipework were completed together with civil works.

These civil works include the vent knockout drum as well as the completion of preparations for concrete pouring for the flowline footings, condensate pipeline and the export gas pipeline "pigging" facility

The Acoustic Enclosure (sound proofing), including the air intake duct and fan equipment have been installed.

Upcoming work

Piping has been delivered to the site for installation from the wellheads to the facility with their fabrication, testing and surface treatments continuing through the Christmas break.

Empire is also preparing to install the main electrical control centre, which will be the heart of the facility. This includes installation of all electrical and instruments around the facility.

Equipment and mechanical parts for the facility continue to arrive regularly on location.

The flash gas compressor, manufactured in Houston, upon its final tests is to be shipped to Fremantle this month.

This removes liquefied petroleum from condensate into the gas stream.

The gas engine alternator that was manufactured in the U.S. is en route by ship to Fremantle from Italy where all the electrical work was completed.
Further updates will be provided as construction progresses towards completion.

Red Gully Gas and Condensate Processing Facility

Commissioning and early production of the facility will provide the optimal production rates to maximise condensate yields from the Red Gully-1 and Gingin West-1 wells, which are the Jurassic aged condensate rich gas wells to be developed in the Perth Basin.

The wells are very high in condensate, producing between 50 to 80 barrels of condensate (light crude oil) per 1 million cubic feet of gas.

Gingin West-1 flowed 7.5 million cubic feet (MMcf) of gas and 375 barrels of condensate per day during testing while Red Gully-1 flowed 12MMcf of gas and 832 barrels of condensate during testing.

Gas produced at the Red Gully facility will be sold to Alcoa (NYSE: AA) under the existing gas sales agreement for 15,000 terajoules of gas that was reached in October last year.

Condensate will be sold to the BP Refinery at Kwinana, Western Australia.

Partners in EP 389 are Empire with 68.75%, ERM Power (ASX: EPW) with 21.25% and Wharf Resources with 10%.

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