(Alliance News) - Middle East and North Africa-focused SDX Energy PLC on Tuesday said it is "very pleased" following an oil find in Egypt.
SDX drilled the Rabul-3 development well on Egypt's West Gharib concession to a total depth of 5,129 feet. It found 116 feet of heavy net oil pay, SDX said, on the Yusr and Bakr formations.
These formations, the company continued, are of "excellent" reservoir quality with an average porosity of 21%.
SDX will complete the well as a producer later in March. It will connect to processing facilities at Meseda and SDX expects it to be brought online at an average stabilised rate of 300 barrels of oil per day approximately, at the upper end of pre-drilling forecasts.
Chief Executive Mark Reid commented: "We are very pleased to announce this latest result in our low cost Meseda/Rabul area, which, thanks to its close proximity to existing infrastructure, will be contributing to cash flow in the coming weeks. This well provides further support to our 2020 gross production guidance of 3,200 barrels to 3,300 barrels of oil per day for Meseda.
"We look forward to updating the market further on our Egyptian drilling campaign in due course."
"Even at our USD55 per barrel long-term planning oil price, approximately 80% of 2020 and 90% of 2021 forecast cash flows will come from our fixed price gas businesses in Egypt and Morocco and accordingly we remain strongly positioned to weather the current fall in oil prices," Reid added.
Shares were 4.6% higher on Tuesday afternoon in London at a price of 15.95 pence per share. They are, however, 17% lower over the past five days.
Energy stocks have been knocked by a crash in the oil price after major producing nations failed to agree on production cuts. The oil price has also been hit by coronavirus, which has sparked fears of a decline in demand amid economic slowdown.
Brent oil was quoted at USD37.47 on Tuesday afternoon, having touched nearly USD30 a barrel on Sunday night.
By George Collard; georgecollard@alliancenews.com
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