Emperor Energy Ltd (ASX:EMP) surged to a new 12-month high after signing an agreement with APA Group (ASX:APA) to progress a pre-FEED study for the Judith Gas Field in the offshore Gippsland Basin, Victoria.
The binding agreement with APA, which has a market cap of approximately $13.262 billion, is for the provision of midstream infrastructure and services related to gas that will potentially be produced from the field.
Shares higher
This drew a strong response from investors with EMP shares up as much as 233% to 6 cents intra-day.
Company director Carl Dumbrell discussed the importance of this agreement for Emperor and Australian gas supplies in an interview with Proactive.
Judith is within the 100% Emperor Energy-owned VIC/P47 Permit in the offshore Gippsland Basin and is near existing gas production facilities operated by APA.
Location of Emperor Energy-owned VIC/P47 offshore Gippsland Basin showing regional permits along with oil and gas fields.
Pre-FEED work
The pre-FEED study will include pre-FEED design for a gas processing plant to operate adjacent to and in parallel with the existing Orbost Gas Processing Plant owned by APA.
It will also include a concept design for a subsea pipeline of approximately 40 kilometres in length from the Judith gas field to a shoreline crossing as well as an export pipeline to the Eastern Gas Pipeline to the north of the Orbost plant.
Judith Gas Field and Greater Judith Compartments.
This work will also entail the refinement of indicative project cost estimates and project scheduling.
Emperor has been working with APA, one of Australia's biggest infrastructure groups, since October last year when an MOU was established.
The Pre-FEED agreement is the first binding agreement progressing from this MOU.
In July 2019 Emperor Energy advised that an Independent Resource Statement had been completed for the Judith Gas Field highlighting:
- 2C Contingent Gas Resource of 150 Bcf; and
- P50 Unrisked Prospective Gas Resource of 1.226 Tcf.
Work to begin in July
Pre-FEED study work is scheduled to begin in July 2020 and will require four months to complete.
APA will carry out the work using a balanced combination of in-house and external expertise.
The design basis for this work is 80mmscf/d (90TJ/day) of sales gas across a 25-year project life with gas processing to meet the AS4564 gas sales specification.