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SDX Energy secures 10-year extension to West Gharib production services agreement to 2031
StockMarketWire.com
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MENA-focused oil and gas company SDX Energy has received approval for a 10-year extension to its West Gharib production services agreement.
It said the Egyptian authorities gave final approval to extend the production services agreements governing its producing Meseda and Rabul oil fields in its West Gharib concession in Egypt until 9 November 2031.
Under the terms of the extension, in which SDX Energy has a 50% working interest, there is a commitment, irrespective of Brent price, to drill six development wells by 31 December 2022 and one water injection well.
It stipulates that should Brent reach $55 for 12 consecutive months during the extension period, four further development wells will be drilled during that period, and that if Brent hits $60 for 12 consecutive months during the extension period, two further development wells will be drilled.
Chief executive Mark Reid said: 'We are very pleased to have secured this 10-year extension to the Production Services Agreement which we estimate increases SDX's share of reserves in our core West Gharib oil asset, certified at 2.2 million barrels in our 31 December 2019 CPR, by 60%. 'With a breakeven price of approximately $20 Brent and to take advantage of the current strong oil price, we plan to commence in Q2 of this year, a drilling programme of up to 12 wells over the next three years with the goal of growing gross production back to around 3,000bbl/d.'
At 9:19am: (LON:SDX) SDX Energy Inc. share price was 0p at 15.25p
Story provided by StockMarketWire.com
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