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(Alliance News) - SDX Energy PLC on Friday said drilling at the SD-6X well at the South Disouq project in Egypt has commenced.
SDX, a Mediterranean and North Africa-focused oil and gas company, has a 55% working interest in South Disouq, which is on the country's northern coast.
The well, also known as Salah, is to be drilled to around 9,000 feet by late March or early April. It is targeted a resource of around 71 billion cubic feet equivalent of gas.
The main targets of the well are in the same formations as London-based SDX's four producing wells, Kafr el Sheikh and Abu Madi.
If the wells are successful, SDX said they would require tie-ins to the South Disouq central processing facility, which would cost SDX USD4.4 million combined.
The company is reviewing development concepts depending on the size of any discovery made. If a 71 billion cubic feet resource was confirmed, it said, two further developments wells would likely be required for full exploitation.
Once drilling at Salah is completed, SDX will move the rig to the Sobhi well, which is around six kilometres to the west.
Chief Executive Mark Reid said: "Salah and Sobhi are very exciting wells for the company with the potential to more than double the reserves to be processed through the South Disouq gas processing facilities.
"We now have three rigs drilling simultaneously in Egypt and Morocco, and I look forward to providing further updates on these campaigns in due course."
SDX Energy shares were up 2.9% in London early Friday at 22.64 pence.
By George Collard; georgecollard@alliancenews.com
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