If you would like to ask our webinar guest speakers from WS Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund a question please submit them here.
Yep unfortunate timing. They had to cover both onshore drilling and decent cash balance to complete negotiations simultaneously. Lot of gas around that SDX acreage in the Rharb though and as the new SDX gas sales agreement showed there's a lot of demand, could probably drill and produce within a year given existing 3D and past exploration.
Don't think it was their preference to do it this way but needs must. Will be drilling this year with a couple of rigs available nearby and hopefully we will have public info on Anchois soon, feel we may surprised by the final candidate.
Sound Energy plc
("Sound Energy" or the "Company")
Project Finance Update
Attijariwafa bank conditioned project financing offer of up to US$237 million, the first of its size for a gas field development in Morocco
Sound Energy (AIM: SOU), the transition energy company, is pleased to provide an update in relation to the project debt funding for the phase 2 development of the Tendrara Production Concession and announces the receipt of a conditioned offer made by Attijariwafa bank.
Project Debt Funding
The Company announced on 23 June 2022 that it had entered into an Arrangement and Mandate letter (the "Mandate") with Attijariwafa bank (the "Arranger"), a Moroccan multinational bank and one of the leading banks in Morocco, under which the Company mandated the Arranger in relation to the arrangement of project debt financing for the Phase 2 development of Sound Energy's Tendrara Production Concession (the "Agreement").
Under the Agreement, as amended and extended, the Arranger was mandated to arrange a long-term project senior debt facility with a term of no more than 12 years of up to 2.250 billion Moroccan dirhams.
The Company is pleased to announce that the Company, on behalf of the Tendrara Production Concession partners, have now received a conditioned offer from the Arranger for a maximum financing of MAD 2.365 billion (c.US$237 million), proposed to be 100% underwritten by the Arranger, subject to the conditions precedent to the conditioned offer being satisfied prior to 30 September 2023 (the "Conditional Offer").
Material terms of the Conditioned Offer
• Borrower: A to be newly incorporated Tendrara Production Concession partner special purpose vehicle incorporated under Moroccan law (the "Borrower").
• Loan amount: MAD 2.365 billion (approx. US$237 million) subject to a maximum gearing level of 65%.
• Term: 12-year term including 2 year grace period from first drawdown.
• Security: Customary security package over Borrower and Tendrara Production Concession.
• Interest rate: Optionality provided to the Borrower to select from fixed rate, variable and fully floating alternatives with at customary margins for hydrocarbon infrastructure development project financing facilities.
• Use of loan proceeds: Design, drilling, construction and operation of wells, a treatment facility (CPF) and a gas pipeline (from CPF to GME) to transport and sell the natural gas produced under the Tendrara Production Concession to the ONEE, as well as all related activities.
• Conditions Precedent to the Conditional Offer:
o Governmental and Ministerial approvals.
o Tax authority clearance of loan structure.
o Amendment of certain Governance documents to lenders satisfaction.
o Amendment of Gas Sales Agreement to lenders satisfaction.
o Conclusion of Pipeline interconnection agreements to the lenders' satisfaction.
o FEED update to len
It's very normal in the upstream world to have less than 50% and still have operatorship. It's very different to ownership of a company. It's being operator in the JOA that gives you control of the project not the %age you own. They'll want the %age that they want to fund, they'll want to be operator to control what happens and the pace.
Https://northafricapost.com/68502-ifc-to-assist-morocco-accelerate-its-energy-transition.html
SDX is pleased to announce that it has, together with the Office National des Hydrocarbures et des Mines ("ONHYM"), renegotiated a gas sales agreement with one of its key customers in Morocco aligned with the regional development strategy and consequently will receive a higher gas price for production with effect from 1 May 2023.
This price increase will enable the Company to expand its exploration and production in Morocco, and permitting for the summer drilling campaign has already commenced.
Morocco remains a core focus for SDX and the Company is well placed to seize the opportunities presented by a very demanding energy market.
Jay Bhattacherjee, Interim Executive Chairman, said:
"We are delighted that we have been able to renegotiate the gas sales agreement with one of our key customers and would like to thank ONHYM for its continued support. Morocco remains a core area for us and we endeavour to expand our energy provider footprint in the country."
Hi guys, apologies but can anyone remind me of the latest capex estimate for the projectc and whether that was for the project as envisaged now ie 110 MMcf/d. Can't locate it anywhere for some reason. Thanks.
Indeed Repsol found Anchois and deemed it uncommercial and gave it up. But as you state very different times with limited demand for gas regionally let alone locally. Now Morocco isn't getting any gas from Algeria after they threw their dummy out and Spain has had to reverse the pipeline and send gas to Morocco rather than the other way round. Local demand for power has surged since Repsol quit.
The Italians have been great at getting extra gas from Algeria and Egypt to replace Russia but the rest of Europe has been pretty useless. Spain and Morocco are politically very close nowadays and Anchois is a good size project for a mid sized operator to get involved in especially when it's only a few km away. It's a good size for Repsol but IMHO a bit small for Total or Eni. Hope I'm wrong obviously but I think Repsol and that kind of size will become involved as it's material to them and they can bring good financing and experience.