IMP - Imperial Corporation

• the Company has now secured a position as a player in the oil and gas sector, not large, but well positioned.
  
• Streamlined operational aspects of its first natural gas acquisition in Pennsylvania.
  
• Secured from Macquarie Bank a US$100 million Credit Facility, at very competitive rates considering the current financial environment.
  
• Commenced a natural gas development program, developing existing locations
  
• To date 7 wells have been drilled, all commercially successful, with an average estimated payback of 2 years, and an average economic life of at least 20 years.
  
• Production on the existing 140 wells has been maintained at constant levels.
  
• Realise its investment in Bemax Resources Limited. This raised approximately $14.5 million for the Company, a portion of which was utilised to repay outstanding debts, leaving the Company with just under $10 million in cash which is higher on a per share basis than the current share price.

US$38 MILLION OIL & GAS ACQUISITION

Resource and energy investor, Imperial Corporation Limited (ASX:IMP) is pleased to announce that its subsidiary Empire Energy LLC has signed a Purchase and Sale Agreement to acquire approximately 303,000 gross acres of land in the Appalachian Basin, 1,805 natural gas wells producing approximately 5,000 Mcfepd or 1.8 Bcfepa at current production levels.
The wells acquired are stable, long life gas producers in New York and Pennsylvania States. In addition, there are at least 250 proved undeveloped locations and over 260 other prospective locations.

Empire Energy will also acquire a fully equipped field office and staff at Mayville, NY. The oil and gas acreage is criss-crossed by extensive gathering networks and over 675 miles of pipeline, ensuring future development drilling can be undertaken with little restriction due to lack of transportation. Gas in the region sells at a positive basis to NYMEX due to the close proximity of major customers and markets.

Independent Reserves Forecasts estimate 1P Reserves of approximately 56 Bcfe and 3P Reserves of 62 Bcfe. Utilising early December 2009 oil and gas swap prices, the 1P PV10 valuation is approximately US$73.6 million, or 3P PV10 valuation is approximately US$78 million.

Total acquisition cost was US$36.3 million, plus a further US$1.7 million placed into escrow to acquire third party revenue interests in a number of the wells.

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