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LONDON (Alliance News) - Sound Energy PLC has received a gas sales agreement offer from the government of Morocco, it said on Wednesday.
The proposed gas sales agreement would cover future production from the Tendrara concession in the east of the north African country.
All gas produced at Tendrara would be sold by Sound to Morocco's state-owned energy firm Office National de l'Electricite et de l'Eau Potable, or ONEE.
The sales price from 2022 will have both a variable element linked to the Brent oil price as well as a fixed element to cover transportation costs. These costs will be capped at USD12.2 million per year.
Based on oil prices of between USD70 per barrel and USD75 per barrel, the gas sales price including the variable and fixed elements would be USD8.50 to USD9.00 per million British thermal units.
Before 2021, ONEE will purchase any gas at the same price at which it buys gas from the Moroccan government currently, which was not given.
Sound shares were 6.8% higher on Wednesday morning at a price of 18.90 pence each.
