New Video Interview Underwood, page-38

Empire Energy was up again this week,soaring from$0.29 to $0.39on respectable volume with the big gains on better than average daily volume coming in Tuesday’s trading possibly on an upbeat research note.The company’s share price has now doubled since the beginning of October.Empire is one of the few ASX listed juniors with extensive exploration tenements in the Beetaloo and McArthur Basins in the Northern Territory, both prospective for enormous reserves of shale gas.The company’s100% owned holdings extendover14.5 million acres.Following the 2018lifting of the NT Government’s moratorium on drilling activity in the state,Origin Energy and Santos have re-commenced exploration and appraisal activity on their extensive Beetaloo Basin assets. On 9 October Origin Energy and partner Falcon Oil & Gas commenced drilling theKyalla117N2-1 appraisal well in EP 117, a permit on trend with Empire’s100% ownedEP187.The well is designed to assess hydrocarbon maturity,saturation and reservoir quality and collect data for subsequent horizontal drilling
Santos will drill and fracture stimulate up to two horizontal wells targeting the Velkerri Shale in EP 161 early in the 2020 drilling season. Empire’s EP 187 lies adjacent to the Santos permit and the company believes the Velkerri extends into its acreage.Empire is currently undertaking a 2D seismic program on Ep 187.Drilling/appraisal success by Empire’s neighbours will not only inform the company regarding the execution of its future exploration and development programs. But it will but also make it a target of potential predators looking to gain access to what hast he potential to become a major source of gas for both an expanded NorthernTerritory LNG hub and the east coast gas market.During the September quarter Empire sold its Kansas assets in the US for US$19.5millionand used the funds to reduce debt from US$25.4 million to US$7.5 million. Empire also entered a new US$7.5million five-year debt facility with Macquarie Bank Limited on improved terms.Empire still has assets in the US in Appalachia(New York and Pennsylvania)and revenue from gas sales will service the debt while the company “considers strategic alternatives for the Appalachia assets over the coming months to maintain its strategic focus on debt reduction and adding value to the Northern Territory assets.”Looks like the assets will also eventually be sold.Empire had US$3.9 million in cash at the end of September.It will pay for the current seismic program from current cash reserves.But it will presumably seek a farm in partner to help fund a future drilling program.Since taking over as CEO in 2018 Alex Underwood has not set a foot wrong, renewing the Board, tidying up and strengthening the balance sheet and positioning the company to become a major player in the coming NT shale gas boom.This past week he announced the appointment of former Elk Petroleum Chief Operating Officer David Evans as COO of Empire.We seethe possibility of the renewed interest in NT shale gas doing for Empire what coal seam gas did for Queensland Gas and a host of other csg players.The company has a market cap of some $90 million at a share price of $0.39