Empire hit by land delays
Empire Oil & Gas managing director Craig Marshall says its company-transforming Gingin gas field development remains on track despite the company missing a self-imposed deadline to finalise the purchase of the land where the processing plant is to be built.
An access dispute with the landowners was due to go to court this week. Empire announced last week it had agreed to buy the land on which it plans to build a processing plant for its Red Gully project, which will supply gas to Alcoa under a deal worth $25 million. At the time Mr Marshall said the final documents would be finalised by Monday of this week.
Mr Marshall said yesterday a binding agreement with landowners had been reached but the parties were yet to sign off on the finer details. He said the final documents had not yet been signed.
_WestBusiness _ understands Empire needs to finalise the land deal by late June or place at risk a Department of Mines and Petroleum offer for a licence for a pipeline linking the Red Gully plant with the Dampier-to-Bunbury pipeline.
Empire announced the licence offer on April 12, noting at the time the DMP offer was conditional on land access agreements being finalised. DMP usually requires companies to take up those offers within 30 days, although that period can be extended under special circumstances.
Empire has not revealed how much it plans to pay for the land. Other sales in the region suggest the land could be worth $1 million, or up to double that if Empire also bought an adjacent lot its pipeline would cross.
Mr Marshall said yesterday that gas sales to Alcoa were due to begin in November. Along with condensate sales from Red Gully, the Alcoa deal is a potential company maker, offering revenue that would underpin exploration in the rest of Empire's extensive WA tenement holdings.
Empire shares eased 0.1¢ to 1.6¢.
