TIDMSDX
RNS Number : 0627S
SDX Energy Inc.
21 June 2018
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY
SDX TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET
ABUSE REGULATION (EU) NO. 596/2014 ("MAR"). ON THE PUBLICATION OF
THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE ("RIS"),
THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC
DOMAIN.
21 June 2018
SDX ENERGY INC.
("SDX" or the "Company")
South Disouq and Morocco Update for Analysts
Prior to today's update for sell-side and industry analysts, SDX
Energy Inc. (TSXV, AIM: SDX), the North Africa focused oil and gas
company, provides the following summary of its recent drilling
campaigns at South Disouq (Egypt) and in Morocco. The presentation
to be used at today's update can be found on the Company's website
at www.sdxenergy.com/investors-presentation.
Egypt - South Disouq Concession (Working Interest 55%)
-- Three successful wells out of four drilled so far;
-- SD-1X and SD-4X discoveries confirmed prospectivity in the
Abu Madi horizon, and the Ibn Yunus-1X discovery identified
additional prospectivity in a new play horizon, the Kafr el
Sheik;
-- Final well, SD-3X, to spud in late June/early July targeting
Abu Madi prospectivity close to the SD-1X and SD-4X discoveries.
This will complete the current drilling campaign on the concession
prior to expected first production at the end of 2018;
-- Based on the discoveries and well testing at SD-1X and Ibn
Yunus-1X, the Company is targeting a minimum of gross 100 bcf of
conventional natural gas and 1 million barrels of condensate with
an anticipated plateau production rate of c.55-60 mmscf/d of
conventional natural gas and c.500-600 bbls of condensate per day
for the first four years;
-- Data from all five recent wells will be used to recalibrate
the existing 3D seismic interpretation to improve future
identification of gas bearing traps in both the Abu Madi and the
Kafr el Sheik;
-- At present five, drill ready, conventional natural gas
prospects targeting > 90bcf (unrisked) have been identified in
the Kafr el Sheik and Abu Madi horizons and one, drill ready, oil
prospect targeting up to 50mmbbls of conventional light crude oil
(unrisked) has been identified in four stacked, individual, deeper
Cretaceous targeted STOIIPs ranging from a mean of c.33 mmbbls to
55 mmbbls with chances of success ranging from 22%-29%;
-- A further eight gas leads have been identified on the current
3D in the Kafr el Sheik, which are targeting up to 1 tcf (unrisked)
of conventional natural gas. Several additional oil leads have also
been identified in the deeper Cretaceous reservoirs; and
-- Up to 170km(2) of 3D is expected to be acquired in Q4 2018
targeting further Abu Madi and Kafr El Sheik prospectivity.
Morocco (75% Working Interest)
-- 2017/2018 drilling campaign completed with seven successful wells out of nine drilled;
-- The LNB-1 and LMS-1 discoveries have confirmed our views on
the prospectivity of the Lalla Mimouna acreage, and opened a
sizeable portion of the Rharb Basin to further exploration;
-- Currently in the final planning stages of the upcoming 240
km(2) Gharb Centre 3D seismic acquisition that will start in early
July;
-- 12 drill ready gas prospects targeting in excess of 20 bcf
(unrisked) of conventional natural gas have been identified across
the acreage for a Q1 2019 drilling campaign, to be potentially
refined and complemented by the new 3D seismic data; and
-- More than 60 further leads have been identified across the
Basin, the majority are or will be derisked by our existing or
upcoming 3D seismic data coverage, targeting an upside potential of
approximately 60 bcf (unrisked) of incremental conventional natural
gas prospectivity.
Paul Welch, President and CEO of SDX, commented:
"We are pleased to provide an update on our successful drilling
campaigns in South Disouq and Morocco.
We are looking forward to first gas in South Disouq expected at
the end of the year and are excited by the new Kafr El Sheik
prospectivity that we have identified in the concession. In
addition, we have started to review rig options for a 2019 drilling
campaign to target the additional gas and oil prospectivity that we
have now confirmed exists in up to six separate locations within
the concession.
In Morocco, we have identified a significant volume of low
risk/high value drilling opportunities which we will be targeting
in our next drilling campaign during 2019, as we continue to grow
our customer base and meet local gas demand. We expect the upcoming
3D seismic acquisition to further de-risk this prospectivity and we
look forward to the commencement of our drilling campaign in the
Spring of 2019."
About SDX
SDX is an international oil and gas exploration, production and
development company, headquartered in London, England, UK, with a
principal focus on North Africa. In Egypt, SDX has a working
interest in two producing assets (50% North West Gemsa & 50%
Meseda) located onshore in the Eastern Desert, adjacent to the Gulf
of Suez. In Morocco, SDX has a 75% working interest in the Sebou
concession situated in the Rharb Basin. These producing assets are
characterised by exceptionally low operating costs making them
particularly resilient in a low oil price environment. SDX's
portfolio also includes high impact exploration opportunities in
both Egypt and Morocco.
For further information, please see the website of the Company
at www.sdxenergy.com or the Company's filed documents at
www.sedar.com.
Competent Persons Statement
In accordance with the guidelines of the AIM Market of the
London Stock Exchange the technical information contained in the
announcement has been reviewed and approved by Paul Welch, Chief
Executive Officer of SDX. Mr Welch, who has over 30 years of
experience, is the qualified person as defined in the London Stock
Exchange's Guidance Note for Mining and Oil and Gas companies. Mr.
Welch holds a BS and MS in Petroleum Engineering from the Colorado
School of Mines in Golden, CO. USA and an MBA in Finance from SMU
in Dallas, TX USA and is a member of the Society of Petroleum
Engineers (SPE).
For further information:
SDX Energy Inc.
Paul Welch
President and Chief Executive Mark Reid
Officer Chief Financial Officer
Tel: +44 203 219 5640 Tel: +44 203 219 5640
Stifel Nicolaus Europe Limited (Nominated Adviser and Joint
Broker)
Callum Stewart
Nicholas Rhodes
Ashton Clanfield
Tel: +44 (0) 20 7710 7600
Cantor Fitzgerald Europe (Joint Broker)
David Porter
Tel: +44 207 7894 7000
GMP FirstEnergy (Joint Broker)
Jonathan Wright/David van Erp
Tel: +44 207 448 0200
Celicourt (PR)
Mark Antelme/Jimmy Lea/Ollie Mills
Tel: +44 207 520 9260
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as such term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Glossary
"bbls" barrels
"bcf" billion standard cubic feet
-----------------------------
"mmscf/d" million standard cubic feet
per day
-----------------------------
"mmbbls" million barrels
-----------------------------
"STOIIP" stock tank oil initially in
place
-----------------------------
"tcf" trillion standard cubic feet
-----------------------------
Forward--Looking Information
Certain statements contained in this press release may
constitute "forward--looking information" as such term is used in
applicable Canadian securities laws. Any statements that express or
involve discussions with respect to predictions, expectations,
beliefs, plans, projections, objectives, assumptions or future
events or are not statements of historical fact should be viewed as
forward-looking information. In particular, statements regarding
the prospectivity of the Company's discoveries, the timing of the
SD-3X well, the timing of production at South Disouq, estimates of
targeted volumes and flow rates, the acquisition of seismic data,
the Company's ability to de-risk the prospectivity of its
opportunities and the Company's plans, should all be regarded as
forward-looking information.
The forward-looking information contained in this document is
based on certain assumptions and although management considers
these assumptions to be reasonable based on information currently
available to them, undue reliance should not be placed on the
forward-looking information because SDX can give no assurances that
they may prove to be correct. This includes, but is not limited to,
assumptions related to, among other things, commodity prices and
interest and foreign exchange rates; planned synergies, capital
efficiencies and cost--savings; applicable tax laws; future
production rates; receipt of necessary permits; the sufficiency of
budgeted capital expenditures in carrying out planned activities;
and the availability and cost of labor and services.
All timing given in this announcement, unless stated otherwise
is indicative and while the Company endeavors to provide accurate
timing to the market, it cautions that due to the nature of its
operations and reliance on third parties this is subject to change
often at little or no notice. If there is a delay or change to any
of the timings indicated in this announcement, the Company shall
update the market without delay.
Forward-looking information is subject to certain risks and
uncertainties (both general and specific) that could cause actual
events or outcomes to differ materially from those anticipated or
implied by such forward--looking statements. Such risks and other
factors include, but are not limited to political, social and other
risks inherent in daily operations for the Company, risks
associated with the industries in which the Company operates, such
as: operational risks; delays or changes in plans with respect to
growth projects or capital expenditures; costs and expenses;
health, safety and environmental risks; commodity price, interest
rate and exchange rate fluctuations; environmental risks;
competition; permitting risks; ability to access sufficient capital
from internal and external sources; and changes in legislation,
including but not limited to tax laws and environmental
regulations. Readers are cautioned that the foregoing list of risk
factors is not exhaustive and are advised to reference SDX's
Management's Discussion & Analysis for the three months ended
March 31, 2018, which can be found on SDX's SEDAR profile at
www.sedar.com, for a description of additional risks and
uncertainties associated with SDX's business, including its
exploration activities.
The forward--looking information contained in this press release
is as of the date hereof and SDX does not undertake any obligation
to update publicly or to revise any of the included
forward--looking information, except as required by applicable law.
The forward--looking information contained herein is expressly
qualified by this cautionary statement.
Oil and Gas Advisory
Certain disclosure in this news release constitute "anticipated
results" for the purposes of National Instrument 51-101 of the
Canadian Securities Administrators because the disclosure in
question may, in the opinion of a reasonable person, indicate the
potential value or quantities of resources in respect of the
Company's resources or a portion of its resources. Without
limitation, the anticipated results disclosed in this news release
include estimates of flow rate and volume attributable to the
resources of the Company. Such estimates have been prepared by
management of the Company and have not been prepared or reviewed by
an independent qualified reserves evaluator or auditor. Anticipated
results are subject to certain risks and uncertainties, including
those described above and various geological, technical,
operational, engineering, commercial and technical risks. In
addition, the geotechnical analysis and engineering to be conducted
in respect of such resources is not complete. Such risks and
uncertainties may cause the anticipated results disclosed herein to
be inaccurate. Actual results may vary, perhaps materially.
In addition to the uncertainties listed above, due to the level
of information available, there is still uncertainty associated
with the volume and flow rate estimates prepared by management.
Some of the risk and uncertainties are outlined below:
-- Petrophysical parameters of the sand/reservoir;
-- Fluid composition, especially heavy end hydrocarbons;
-- Accurate estimation of reservoir conditions (pressure and
temperature), currently unknown but roughly estimated based on
range of drilling mud of 1.6-1.65 SG;
-- Reservoir drive mechanism;
-- Potential well deliverability; and
-- The thickness and quality of the reservoir section away from the current location.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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