RE: Price of LNG24 Mar 2026 07:30
Sound Energy
SOU LN- Oil & Gas Producers
Operational update
Sound has announced that it has secured new debt funding and an equity raise
totalling US$2.2m, reinforcing the company’s balance sheet going into first gas
from Tendrara Phase 1 in early Q3 2026, and accelerating progression of the
company’s Morocco solar JV.
Tendrara Phase 1 progressing towards first gas. The Tendrara Phase 1 LNG tank has now
been successfully tested, post earlier commissioning of the gas gathering system. We now
await commissioning of the micro-LNG plant, which will then allow first gas sales from the
project. This is now expected in early Q3 2026 (from Q2 previously) post a schedule update
from the EPC contractor.
First gas from Tendrara Phase 1 will be a very important moment for Sound, marking the
start of revenues to contribute to company costs, while also helping demonstrate the
development viability of the wider Tendrara asset, helping pave the way for the much larger
Phase 2. While Phase 1 will develop 39bcf of gross sales gas, Phase 2 is targeting
development of 265bcf, including a connection directly into Morocco's regional pipeline
network. The Phase 2 infrastructure can then support development of any new discoveries in
the area made by the JV, with two exploration/appraisal wells already planned (and carried
for Sound by its JV partner). Phase 2 is hence where the most significant value lies in the
Sound portfolio, with Phase 1 an important enabler for this. Going forward, alongside Phase 1
first gas sales, we look for progression of Phase 2 to FID during 2026.
Solar JV also being progressed. The additional funding will also allow progression of
Sound's Morocco solar JV with Gaia Energy. The JV, now christened Tayra Energy, is
reviewing a short list of 12 different sites targeting development of a total of 270 MW of
solar, tying this into Morocco's medium-voltage grid and taking advantage of recent
government reforms to facilitate this. The JV already has five of the sites under option; we
await further updates.
New funding from debt and equity. Sound's new funding is in two parts. First is a EUR1.3m
debt facility, from an international investment bank, which the company can draw down at its
option. This carries interest of 20% per 120 days, and is repayable at the end of 2026. The
company has also raised £0.5m of equity at 5.0p. This should all see the company through
first gas sales at Tendrara and the revenues this will then begin to provide.
Overall, we are pleased to see Sound secure this new funding, which contains optionality for
the company as to how much is drawn down. Getting to first gas sales from Tendrara is the
company's key aim, and this new funding facilitates that. We continue to believe there is a
very significant prize for Sound in progressing Tendrara, through Phase 2 and beyond, and we
are pleased to see this continue to make good progress.
Forecasts and va
Sign In
Follow the stocks
