Empyrean Regulatory News (EME)

27 Jul 2005 12:11

Empyrean Energy PLC27 July 2005 27 July 2005 Admission to trading on AIM after £2.5 million placing Gas exploration project, Germany- commercial viability to be established in Q4 2005 Developing energy projects in geopolitically stable environments The Directors of Empyrean Energy PLC ("Empyrean" or the "Company"; Ticker:"EME") today announce the commencement of trading on AIM after a placing by HBCorporate raised £2.5 million, before expenses. The Company is issuing 7,144,282ordinary shares, representing 23.3 per cent. of the enlarged issued sharecapital of the Company, at 35p per ordinary share. The placing will raise £2.5million (before expenses), of which approximately £2.1m will be receivable bythe Company. The Company will be issuing to each subscriber under the placing 1warrant (exercisable at the placing price) for every 3 ordinary sharessubscribed. The Directors do not intend to apply for the warrants to be admittedto trading on AIM. Empyrean was incorporated in the United Kingdom in March 2005, to finance energyresource exploration and development projects in geopolitically stableenvironments. The Company has acquired the rights to earn up to a 52% workinginterest in the Neues Bergland permit, a substantial fractured reservoir naturalgas exploration project in Germany. The highly prospective area of the Neues Bergland permit is located close toFrankfurt in Germany. The permit contains the Pfalzer Anticline which is a 515square kilometre structure containing deep anthracitic coal beds overlaid byshale and sediment. The coal beds are too deep to mine economically but havebeen estimated by the independent expert to have generated many hundred trillioncubic feet ("Tcf") of gas, with a recoverable gas potential of up to 6.2 Tcf inthe first drilling prospect alone. The Company will test a minimum of threelarge potential pay-zones at different depths within the first drilling prospectwith drilling of the Glantal-1 well in the fourth quarter of 2005. Theindependent expert has calculated the smallest of these potential pay-zones hasthe potential to hold a recoverable 1.2 Tcf of gas. Following a review of theresults, a decision will be made by the Directors as to the commerciality of theGlantal prospect. Seal integrity will be of the highest importance. Afterdrilling the Glantal-1 well the Company will have approximately £1.7 millionavailable to commence development of a discovery or continue exploration. Shouldthe permit prove to be economically unviable the Company will use remainingfunds to pursue alternative projects. Gas prices in Germany are strong and demand is growing due to existinggovernment policies requiring the reduction of nuclear and coal poweredelectricity generation. These factors will enhance the economic viability of acommercial discovery. During 2003 Germany was the sixth largest consumer of energy in the world, andthe fourth largest consumer of natural gas. In 2003 Germany imported 75% of itsannual natural gas consumption of 3.2 Tcf. Germany's national natural gasreserves were estimated at 10.8 Tcf at the start of 2004. Following the establishment of seal integrity Empyrean will engage in furtherfund raising in order to secure the 52% interest in the Permit which it isentitled to under the conditions of the farm-in agreement. Commenting on the admission today Christopher Lambert, Executive Director, said:"Given the possible size of the reservoir within our permit and potential amountof recoverable gas our first well, Glantal-1, is extremely exciting for such asmall company. Even a modest discovery of gas would be commercially viable as weare so close to existing gas distribution infrastructure." Laurence Read/Amanda Harris David Newton / Toby HowellConduit PR HB-CorporateTel: +44 (0) 207 618 8760 Tel: +44(0) 2207 510 8600Mob: +44 (0) 7979 955 923 This information is provided by RNS The company news service from the London Stock Exchange