(Alliance News) - SDX Energy PLC said Monday it is on track and on budget at South Disouq, Egypt, having completed the first of the three project milestones.
SDX has a 55% interest in the South Disouq gas project, where factory acceptance testing for the contract processing facility and the compressor are now complete.
The two pieces of equipment are now being shipped to Egypt and will arrive at South Disouq midway through August, with first gas still expected in the fourth quarter of 2019.
3D seismic data from South Disouq is still being interpreted, and once complete will be part of any future drilling decisions.
SDX also has a 75% working interest and is operator of a 12-well Moroccan drill campaign, which is due to start in the fourth quarter.
Planning has begun for the campaign, which will target a gross unrisked prospective resource of 15 billion cubic feet of gas. SDX said "long lead items" are already ordered and "the drilling rig and all other key contracts" have been finalised.
Gross production for the six months ended June 30 has met annual guidance. In Egypt, 50% -owned Maseda and Rabul produced gross 4,300 barrels per day and 50% owned North West Gemsa produced gross 3,900 barrels of oil equivalent per day. From SDX's 75% owned Moroccan interests, first half production was 6.0 million standard cubic feet per day gross.
As at June 30, SDX's cash stood at USD11.0 million, slightly down from USD11.4 million on March 31. This, as well as the company's USD10 million facility provided by the European Bank for Reconstruction & Development, means SDX is presently funded "for all existing and planned activities".
Chief Financial Officer & Interim Chief Executive Mark Reid has been given a mandate to "deliver first gas at South Disouq" in the fourth quarter and start the Moroccan drill campaign starting in the fourth quarter. In pursuit of this mandate, Reid has created an executive committee including the country managers of Egypt and Morocco.
SDX said it will provide a "further update on the CEO position" "in due course".
Reid said: "SDX continues to focus on the successful delivery of its key operational targets at the South Disouq development in Egypt and the upcoming Morocco drilling campaign.
"We are pleased to report that good progress has been made on these initiatives and both remain on schedule and on budget. Once the South Disouq 3D has been interpreted, and after partner discussions, we will assess the potential for a drilling campaign and update the market in due course."
"Our cashflow and receivables collections remain strong and I am pleased to report that all of our existing and planned activities are fully funded from current cash, near-term cash flows and the undrawn EBRD facility. I look forward to providing further updates on our activities during the second half of 2019."
Shares in SDX were up 0.4% at 19.33 pence on Monday at mid day.