Interview with Alex Underwood, MD/CEO of Empire Energy Group Ltd.

Our previous interview: https://www.cruxinvestor.com/posts/empire-energy-asxeeg-technical-analysis-due-diligence-4162

Recording date: 26th January 2024

Empire Energy controls huge shale gas resources in Australia's Northern Territory, estimated at over 40 trillion cubic feet by independent assessors. With domestic east coast markets facing looming supply shortfalls amid rising global demand, Empire has a clear strategic production roadmap to monetize these world-scale gas assets.

Initially focussed on oil and gas production in the US, Empire pivoted towards acquiring and proving up acreage in the vast onshore Beetaloo Basin after capitalizing on the US shale boom's early stages. Australia's Beetaloo region shares similar shale geology and Empire moved swiftly to build a dominant position. Few companies boast more prime shale acres.

Having confirmed world-class volumes of gas in place via drilling vertical and horizontal test wells, Empire is fast-tracking low cost pilot schemes. An initial 3 well development campaign with 60 stage hydraulic fracturing aims to flow test production potential. Early success would derisk substantial follow-on development, likely attracting industry interest.

Empire has accelerated pilot production plans by acquiring a second-hand gas facility for a bargain $3 million. Refurbishing this will expedite on-site infrastructure assembly. Along with advanced talks on securing gas sales agreements, first cash flow now looks possible inside 12 months.

Beyond pilot schemes, Empire has a multi-stage production growth plan. Phase one fills spare capacity in an existing pipeline traversing Empire's permits. Rapidly expanding output from 25 million cubic feet per day to feed Darwin's energy shortfall would generate over $100 million annual revenue. Subsequent phases look to ramp up production, ultimately targeting 1 billion cubic feet daily for southern LNG exports. Attractive economics expected from initial wells provides cashflow to fund each organic development stage.

From an early entry point, Empire Energy offers leveraged exposure to realization of the Beetaloo Basin's full potential. Key de-risking milestones are approaching fast. Cash flow and resource appraisal progress could spotlight Empire's world-scale gas resource. Its disciplined step-by-step commercialization strategy aims to capitalize on strengthening gas market conditions. Targeting first production within 12 months provides investors a near term catalyst.

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View Empire Energy Group's company profile: https://www.cruxinvestor.com/companies/empire-energy-group

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