Empire Oil & Gas subsidiary Empire Oil Company has entered voluntary administration.

Empire Oil entered receivership after lender Mineral Resources issued the company a default notice for a $15 million loan.

Deloitte was appointed as receiver and manager of assets including those related to the Red Gully gas project in Western Australia.

Production at the Red Gully-1 well has been suspended since earlier this year, but the company had expected to bring it back online.

Empire Oil & Gas has now announced it has “no choice” but to appoint administrators.

“The decision comes despite the company and Empire Oil subsidiary making significant and urgent efforts to explore the available options in relation to the Red Gully-1 well and the Empire Oil Subsidiary’s business and assets,” Empire Oil & Gas said.

“The directors of the company and the Empire Oil subsidiary very much regret that these circumstances have come to pass.”

Andrew Smith, Peter McCluskey and Martin Jones from Ferrier Hodgson have been selected as voluntary administrators, set to work with Empire Oil’s stakeholders while conducting financial and operational assessments.