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Empire Energy Group Confirms McArthur Basin Shales Are Oil Generative

Empire Energy Group's (ASX: EEG) McArthur Basin shale research program with the University of Adelaide Research Unit gas identified a number of zones within the Northern Territory basin that show good potential for hydrocarbon prospectivity.

Importantly, it confirmed the target carbonaceous black shale intervals in the Barney Creek and Velkerri Formations are within the oil, oil-condensate and wet gas generation window.

In addition, the study found that the two formations contain Total Organic Content of up to 6.4% with Marine II and Mixed II-III type Organic Carbon as well as pay zones of up to 150 metres.

The initial research program, which has just completed its third stage, is now drawing to a close.

Empire Energy has started identifying those segments of the Basin with the optimum petroleum potential and to review opportunities for the most efficient and cost effective method, including seeking potential partners, to commence the exploration and development of its extensive, highly prospective oil and gas tenements in the McArthur Basin.

This involves the integration of thermal maturity results into the regional 3D geo-model of the McArthur Basin, which has now been completed by the Company.

The results from integration of these data will allow the company to construct a series of 'Common Risk Segment' maps. These will indicate those segments of the basin where the target shales have the optimum depth, geological structure and geochemical parameters to be the focus for the initial exploration programmes.

The preliminary emphasis will be to further develop the most prospective shale common risk segment areas and conventional structures identified during the course of the geo-modelling which currently includes, and is not limited to:

- 26 potential conventional structures with EP(NYSE:A)180, 181 and 182; and
- a potentially highly prospective unconventional shale outlier within EP187, similar in nature to the Myrtle sub-basin, along with a further 8 potential conventional structures in EP187.

New and additional data that will become available during 2013/14 will also be integrated.

These areas are likely to be progressed as initial exploration drilling locations in 2014/15.


The third stage research study confirming that the Barney Creek and Velkerri formations shares within the onshore McArthur Basin are in the oil, oil-condensate and wet gas windows is a positive for Empire Energy as it indicates that any successful discovery will be of higher value liquids.

In addition, a liquids discovery will potentially be both faster and easier to develop as it would require less infrastructure than a primarily gas discovery.

Shares in the company are likely to trade higher today.

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