Sound Energy PLC (LON: SOU) have announced that they have reached a deal with an unnamed UK company to sell the majority of their eastern Morocco portfolio stake.
The deal will be valued at $112.8 million as highlighted in the investor update on Wednesday morning.
Back in May, the Moroccan-focused gas company has decided to explore monetisation options for its interests in the Tendrara production concession, the Greater Tendrara petroleum agreement and the Anoual permits, with a view to assessing a sale of this eastern Morocco portfolio prior to a final investment decision.
The last 12 months have been very mixed for Sound Energy, and shares have been volatile.
Less than a year go, shares sunk in December to a 52 week low, but since then recovery has been made which will appease shareholders.
In the mining and gas industry there have been disruptions as the more established names have been hit by lower profits, showing global supply and operational issues.
Last week, it was reported that Shell’s (LON: RDSB) profits had sunk due to low oil prices.
Competitors such as SABIC (TADAWUL: 2010) reported an impairment loss of $400 million, and Total SA (LON: TTA) to report slower profits as profits fell 15% in the third quarter update.
Sound Energy have reported that the announcement was made to sell its Moroccan portfolio, the company has since entered into non-disclosure agreements with 23 companies and which resulted in the company receiving a number of non-binding offers.
In the Wednesday update, Sound Energy said it has granted an unnamed purchaser an exclusivity period, expiring on February 14 next year.
This was to finalise a binding sale & purchase agreement for 51% of Sound Energy’s stake in the eastern Morocco portfolio for $112.8 million.
“The proposed transaction being progressed on an exclusive basis funds development of the Tendrara project, provides early monetisation of a substantial part of our established gas resources and retains upside for our shareholders through both future gas production and further exploration drilling,” said Chair Simon Davies.
The company said it will also provide the undisclosed purchaser with a one-year option to acquire a further 9% of Sound Energy’s remaining interest in eastern Morocco portfolio.
