Empire Secures Funds Earmarked for Bellevue Drilling
Empire has announced that Phillip Simpson, a company director, has loaned EEGC's wholly owned subsidiary Great South Land Minerals Limited (GSLM) a total of AUD$400,000, and has also purchased Mach One Corporation shares from Empire for a further total of AUD$244,000.
These funds, totaling AUD$644,000, could allow deep drilling at Empire's Bellevue #1 well to commence during the month of February, said the company.
In return for the above consideration, Empire and Great South Land Minerals have agreed to repay in full loans of AUD$1,710,000 made to GSLM by Mr. Simpson and his company, Terralinna Pty Ltd., in 2008. This total, which will be remitted plus interest and the value of Mr. Simpson's remaining employment entitlements, will be comprised of 1,810,000 Mach One shares held by Empire, a Mach One Convertible Note with a face value of USD$523,821, and 2.5 million newly-issued Empire shares. In acceptance of this settlement, Mr. Simpson has agreed to resign as executive director of GSLM and as a director of Empire, effective immediately.
Empire CEO and founder Malcolm Bendall said, "Phil Simpson has made a valuable contribution during 2008, both as Operations Manager supervising drill site construction and top-hole drilling at Bellevue #1 and as a Director of GSLM and Empire. His ongoing financial support this week of AUD$644,000 through Terralinna Pty. Ltd. has advanced Empire's drilling program by enabling the purchase of the final equipment needed to drill ahead at Bellevue #1. As the CEO and also a personal friend I wish him and his wife Paula every success in their new business venture and their humanitarian work in Africa. Now that I have returned from overseas, I have taken the role of Responsible Person at the well site to give Empire the benefit of my over 30 years' drilling experience."
The outstanding AUD$1.14 million expected funding due to GSLM under a financing agreement remains unpaid, resulting in the delay of the commencement of drilling Bellevue #1. Empire and Hunt Energy are negotiating in order to facilitate the commencement of drilling planned to start on Feb. 9th. Great South Land Minerals have now purchased all equipment and services needed to drill ahead at Bellevue #1, including drilling bits for the Hunt Energy Rig #3 rig plus approximately 264m of 13-3/8" casing which, once cemented, will be attached to our 5000 psi, API rated well head which is currently on site. These materials are located in Western Australia and GSLM is currently preparing transportation of these drilling materials to the Bellevue site to allow drilling to proceed. These essential materials are expected to arrive at Bellevue mid to late next week.
GSLM's Drilling Manager, Ted McNally said, "Pectil Engineering's truck mounted mud logging unit has been mobilized from Queensland and is expected to arrive at the Bellevue #1 drill site early next week. The unit is technically a most advanced oil and gas logging platform; able to deliver integrated on-line data acquisition, data processing and wireless for internet data distribution. It is configured to provide satellite communications but is currently configured to provide internet plus wireless-phone communications for the GSLM operator."
Bronte Park Highland Village is now being leased and managed by Great South Land Minerals as a rig camp and the supporting infrastructure has been upgraded to accommodate over 30 personnel; including rig crew, drilling supervisors, geologists, support team, staff and contractors.
Malcolm Bendall said, "With these asset sales, ongoing negotiations and mobilization and purchase of equipment, Empire is now in a position to push ahead with our drilling program. These agreements have been negotiated during particularly difficult global financial times and despite the failure of expected funding under an existing loan agreement. These agreements have substantially reduced Empire's current debt and will enable us to proceed to drill Bellevue #1. We expect our planned Rights Offering, which is currently proceeding through regulatory approval procedures, will also raise substantial capital (up to AUD$12 million) which will enable us to proceed with the completion of environmental studies, site preparation and the drilling of Thunderbolt #1."
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