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Sound Energy PLC on Thursday said it has made strides towards financing its production concession in eastern Morocco.
The Morocco-focused upstream gas company has entered into an arrangement and mandate letter with Attijariwafa bank of Morocco for debt financing of the company's Tendrara production concession.
Shares in Sound Energy were up 8.0% to 1.75 pence each in London on Thursday morning.
The bank will also be offered eight months of exclusivity to provide the firm with a long-term senior debt facility, with a term of no more than 12 years for up to MAD2.25 billion, around $250 million. This would partly finance the estimated MAD3.00 billion cost of the Tendrara production concession.
For the remaining amount, the company said it is advancing potential vendor financing, secondary subordinated debt and partial asset disposal options.
‘This mandate is a significant step towards reaching final investment decision unlocking further the value of Tendrara Concession to Sound Energy shareholders, that can aid the provision of economical and secure gas supply for the local Moroccan power production and domestic markets,’ said Executive Chair Graham Lyon.
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