“With the resurgence of interest in the oil prospective Canning Basin, Empire considers it is well placed and has pre-empted the timing of renewed interest in the Basin where there is increased drilling activity planned by exploration companies in 2005,” Empire said in a statement.

Empire also has it has the EP 104, R1 and Production Licence Application Area over the West Kora Oilfield and the Point Torment Gasfield with the planned updip Stokes Bay-1 well prospective for both oil and gas.

In addition to these areas, Empire has the large Permit Application 14/00-1 in the Canning Basin to explore the ‘sub-salt play’. The sub-salt play also extends into the southern portion of the EP 438 permit.

This play consists of large prospects underlying an evaporate sequence, the best oil and gas sealing sequence in many oil fields worldwide.

In the new EP 438 permit, the mapped Hedonia anticlinal feature is the focus of initial exploration.

“The Hedonia-1 well, drilled by Gulf Oil in 1984, is of significant interest as the well lost severe circulation of drilling fluids upon drilling into the top of the reservoir objective Ordovician Willara Formation at 1,050 metres,” Empire said.

“This severe lost circulation indicated high permeabilities in this limestone reservoir where a significant gas show was recorded. There were also numerous oil and gas shows in the marine black shales of the Goldwyer Formation which demonstrated oil maturity in these source rocks.”

The potential remains to either re-drill or re-enter the Hedonia-1 to properly test this reservoir, according to Empire.

“It is unlikely that testing of the Hedonia-1 well by Gulf Oil ever recovered formation fluids due to the excessive lost circulation material and drilling fluids injected into the reservoir while drilling,” the company said.

“Consequently the well has never evaluated the formation fluids trying to flow from the well during the cased hole testing program. The flow of fluids in the well could likely be oil considering the oil shows and the results of nearby wells.”

Empire now plans to fully evaluate prospects and leads in its new Permit. It said it would prepare a modern test program for Hedonia-1, some 20 years later using appropriate modern technology.

The company said it estimated potential recoverable reserves for the Hedonia Prospect to be roughly 5 million barrels of oil if the structure is filled to spill.