Member Info for shakeypremis

We could ask SDX IR but there's no point because they never respond to the likes of you or I.

That is the idea. But they have struggled to get new customers. They also drill wells to ensure they can fulfil the supply requirements of their existing customers out to several years in the future to ensure security of supply.

Yes, but how long out in the future is it for each customer? We don't know. There was an investor call where this was discussed after I asked whether the contracts in Morocco were fixed price US dollar contracts and what would happen if the dollar were to fall significantly. It turned out that they were priced in local currency so that wasn't a concern. I don't think they were exactly fixed price contracts either.

Most current customers are probably on a contracted rate with perhaps some floor ceiling type structure. I doubt there will be much negotiating the short term. New customers (not that SDX ever get any) will be different. Perhaps the increasing gas price may attract some potential customers to SDX. I would not expect to see any though given previous trends.

They did mention when I asked them in an investor call last year that they wouldn't be looking to bottle the gas themselves but were looking at alternative routes to market and the way the answer was phrased it made it sound like while the bottling was not a route to market as I proposed it was close or similar to what they perhaps had in mind. I think SDX need to find a bit more gas in Morocco to sell significant additional volumes via a trucked CNG solution while still supplying their bread and butter pipeline customers. Perhaps the Top Nappe can provide that additional gas.

It's hopefully the mystery, fabled alternative route to market we've been hoping for. It could also possibly be compression of the gas to expand capacity of the existing pipeline I suppose.

Where do you see that? It was posted 24th December 2020.

LOL, I can see where you've confused yourself. This is the date of article at the top of the article.

24 décembre 2020 à 20:16

See where you've gone wrong?

https://lematin.ma/journal/2020/sdx-energy-maroc-decroche-nouveau-financement-berd/350075.html

Yes;

"New EBRD support for the Moroccan energy sector. The European Bank for Reconstruction and Development has just signed a financing agreement of 25 million dollars in favor of SDX Energy Morocco. This facility, with a maturity of 5 years, is subdivided into two tranches. A first pledged of $ 10 million will be used to connect local industries to the company's existing gas fields in the Gharb region. The second uncommitted of a maximum amount of $ 15 million depends on the acquisition by SDX Energy of other natural gas assets in the country, and would take the form of infrastructure investments, in particular for the possible use of gas. '' advanced compressed natural gas (CNG) technology.

According to the EBRD, this new loan will allow the Moroccan subsidiary of the British company SDX Energy Plc to finance part of its investment plan of 65 million dollars to develop its operations in Morocco and, thereby, support the efforts of the country to place gas, like renewable energies, at the center of its decarbonisation plan in response to the commitments made within the framework of the COP 21."

Just what exactly are SDX up to in Morocco? US$65m is a lot of money. It's not just for drilling wells and connecting customers.

COP 21 - https://unfccc.int/process-and-meetings/conferences/past-conferences/paris-climate-change-conference-november-2015/cop-21

Sorry, should have posted the link;

https://lematin.ma/journal/2020/sdx-energy-maroc-decroche-nouveau-financement-berd/350075.html

So they've managed to get up to US$25m from the EBRD then. The first US$10m is for connecting customers to SDX's gas infrastructure. The second US$15m is for the potential acquisition of natural gas assets in Morocco.

I think what a lot of investors are overlooking with SDX is the drive towards low-carbon energy production/consumption (ESG etc) and incoming carbon-taxes. Low-carbon energy is going to be in demand and SDX can find it and supply it in Morocco.

Continued;

...production and gas transport infrastructure associated with customers of the industrial zone of Kénitra. . It should be noted that SDX holds a direct stake of 75% in the entire Moroccan portfolio, which includes the exploration permits of Sebou Central, Gharb Occidental, Lalla Mimouna North, Moulay Bouchta Ouest and Lalla Mimouna Sud, as well as a number of exploitation concessions containing the producing wells. SDX sells the gas produced by its Moroccan assets to eight customers at contract prices of between 10 and 12 dollars / Mcf."

"The European Bank for Reconstruction and Development (EBRD) signed a $ 25 million financing agreement for SDX Energy Morocco. This five-year facility includes a first committed tranche of $ 10 million to connect local industries to the company's gas fields in the Gharb region. A second uncommitted tranche of up to $ 15 million depends on SDX Energy's acquisition of other natural gas assets in the country.

New EBRD support for the Moroccan energy sector. The European Bank for Reconstruction and Development has just signed a financing agreement of 25 million dollars in favor of SDX Energy Morocco. This facility, with a maturity of 5 years, is subdivided into two tranches. A first pledged of $ 10 million will be used to connect local industries to the company's existing gas fields in the Gharb region. The second uncommitted of a maximum amount of $ 15 million depends on the acquisition by SDX Energy of other natural gas assets in the country, and would take the form of infrastructure investments, in particular for the possible use of gas. '' advanced compressed natural gas (CNG) technology.

According to the EBRD, this new loan will allow the Moroccan subsidiary of the British company SDX Energy Plc to finance part of its investment plan of 65 million dollars to develop its operations in Morocco and, thereby, support the efforts of the country to place gas, like renewable energies, at the center of its decarbonisation plan in response to the commitments made within the framework of the COP 21.

A loan structure that does not exist on the local market
The industrial acceleration that the Kenitra region is currently experiencing has led to an increase in energy demand, in particular in the new Atlantic free zone, where the manufacturer PSA and part of its ecosystem are located. “The funded project will facilitate the substitution of polluting petroleum products - essentially LPG - by cleaner natural gas in Moroccan industry, which should lead to significant emission reductions of around 200,563 tCO2eq over 10 years. SDX's additional gas supply will be used in full in the local industrial zone ”, underlines the EBRD in the loan file. The institution considers, moreover, that the loan is granted under advantageous conditions compared to the market.“The EBRD offers financing that commercial entities do not provide on reasonable market terms, such as a longer grace period. This type of financing is necessary to structure the project. The EBRD is therefore proposing a loan structure backed by a reserve that best corresponds to the nature of this development project but which is not available on the local market ”, it is specified. For her, the private oil and gas sector in Morocco is in the early stages of its creation, which hardly attracts financial institutions given their lack of expertise in this sector.Note that the EBRD had already granted in July 2018 a loan of 10 million dollars to SDX Energy Maroc to finance the improvement of upstream

Who writes this crap? Conflating BOE's with barrels of oil. SDX's Moroccan BOEs are worth more than the current barrel price but their Egyptian gas is worth a lot less.

Hit long standing resistance zone/s this week. Most likely won't be strong enough to break through, so it'll back off and hopefully bounce off the 50 day moving average or somewhere around 17p. Then perhaps the next leg up will see it break through 20p. Probably a month or so to wait.

https://invst.ly/tc-4f

I am with you there. Don't think management care about that.

Can't you work it out? It's CAPEX spend. They've spent a lot developing Morocco and Egypt, I think the CPF cost something like US$20m alone.

The latest Moroccan drilling campaign is not just targeting 2bcf but also the Top Nappe prospect and also testing a previously drilled well.

Of course, none of this forward weighted stuff impresses the market at all.

Nberzins, when SD can only generate circa US$12m per year (approximately) in free cash-flow, it is not surprising the cash balance doesn't increase when you see them spending US$12m in Morocco to drill wells for example. There has been a lot of money spent in CAPEX in both SD and Morocco. Of course they are actually going to generate a return on the money they've spent which is reflected in the increasing NPV of the reserves of the company.

I broadly agree, two gripes though, cash position (explainable via various means however) and the additional Moroccan demand coming from the Chinese car parts maker. No mention of that.

Also seems their partner IPR will participate in the upcoming SD drills, most notably Hanut. While this means if successful SDX will not reap all 100% of the gas (after government theft), it must mean IPR also see promise and also if it fails then less cash wasted by SDX. Swings and roundabouts, less risk, less reward. Still, if successful the decision can still be made to upgrade the CPF and increase production.

I broadly agree, two gripes though, cash position (explainable via various means however) and the additional Moroccan demand coming from the Chinese car parts maker. No mention of that.

Also seems their partner IPR will participate in the upcoming SD drills, most notably Hanut. While this means if successful SDX will not reap all 100% of the gas (after government theft), it must mean IPR also see promise and also if it fails then less cash wasted by SDX. Swings and roundabouts, less risk, less reward. Still, if successful the decision can still be made to upgrade the CPF and increase production.

Don't get your hopes up on the vaccine bringing things back to normal or even working as stated. Don't call me a conspiracy theorist. If you look back to February 2020 I predicted on this board this would evolve in to a world-wide pandemic (yes 50/50 chance of being right just on chance alone) so give me a shred of credit and don't lambast me lol.