Empire Energy Group (ASX:EEG) received binding commitments to raise nearly AU$27.8 million through the issue of 173.4 million shares at AU$0.16 apiece, with a commitment from directors to invest a further AU$250,000, subject to shareholder approval, according to a Friday filing with the Australian bourse.

The company also plans to issue one attaching unlisted option for every two shares subscribed for by participants under the placement, exercisable at AU$0.24 and expiring two years from the allotment date, also subject to shareholder approval, the filing said.

Proceeds will be used for hydraulic stimulation and extended production testing of the Carpentaria-5H well, preparation works for the Carpentaria gas plant, and additional working capital.

Additionally, the company will launch a share purchase plan to raise up to AU$3 million on the same terms as the placement, per the filing.

Shares were down 17% in morning trade on Friday.