Sound Energy To Sell More Than Half Its Morocco Portfolio Stake

(Alliance News) - Sound Energy PLC on Wednesday said it has now agreed with an undisclosed UK ...

Alliance News 6 November, 2019 | 9:16AM
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(Alliance News) - Sound Energy PLC on Wednesday said it has now agreed with an undisclosed UK company to dispose of the majority of its eastern Morocco portfolio stake for a total of USD112.8 million.

Sound Energy shares were trading 20% lower in London on Wednesday at 5.50 pence each.

Back in May, the Moroccan-focused gas company has decided to explore monetisation options for its interests in the Tendrara production concession, the Greater Tendrara petroleum agreement and the Anoual permits, with a view to assessing a sale of this eastern Morocco portfolio prior to a final investment decision.

Sound Energy said it has since entered into non-disclosure agreements with 23 companies and which resulted in the company receiving a number of non-binding offers.

On Wednesday, Sound Energy said it has granted an unnamed purchaser an exclusivity period, expiring on February 14 next year, to finalise a binding sale & purchase agreement for 51% of Sound Energy's stake in the eastern Morocco portfolio for USD112.8 million.

On completion of the transaction it is anticipated that Sound Energy will retain a 23% overall stake in the eastern Morocco portfolio.

The total consideration comprises a USD54.3 million in cash, Sound Energy said, payable in tranches, and an estimated USD58.5 million carry with respect to Sound Energy's future capital expenditure requirements, relating to its retained interest in the Tendrara production concession in order to achieve first gas production.

The company said it will also provide the undisclosed purchaser with a one-year option to acquire a further 9% of Sound Energy's remaining interest in eastern Morocco portfolio on the same terms.

"The proposed transaction being progressed on an exclusive basis funds development of the Tendrara project, provides early monetisation of a substantial part of our established gas resources and retains upside for our shareholders through both future gas production and further exploration drilling," said Chair Simon Davies.

By Evelina Grecenko;

Copyright 2019 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Sound Energy PLC 1.42 GBX 1.07 -

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