(Alliance News) - Sound Energy PLC said Wednesday it has entered a memorandum of understanding with Morocco's state power firm Office National de l'Electricite et de l'Eau Potable, as it continues to negotiate a gas sales agreement, first signed in May.
The memorandum covers the first 48.4 million standard cubic feet per day of natural gas production, with arrangements for further production to be negotiated in the final gas sales agreement.
The gas has been priced and sold to Office National de l'Electricite at the M04 tie in point of the Gazoduc Maghreb Europe pipeline.
The memorandum includes a fixed unitary price of a minimum annual volume of 29.0mmscf/d, which once implemented will result in first year gross revenue attributable to the Tendrara concession of USD84 million.
In May, Sound Energy 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. The final gas sales agreement is still under negotiation.
Shares in Sound Energy - which is headquartered in Sevenoaks, UK - were up 7.0% at 7.59 pence on Wednesday in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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Sound Energy (SOU)