4 October 2017
Sound Energy PLC
("Sound Energy" or the "Company")
Eastern Morocco: Exploration Drilling Programme
Sound Energy, the African and European focussed upstream gas company, is pleased to announce a forthcoming, high impact, three well exploration drilling programme in Eastern Morocco.
Commenting on today's announcement, James Parsons, Sound Energy's Chief Executive Officer said:
"Sound Energy is now approaching another exciting period of back to back drilling in Eastern Morocco. The three well exploration programme we are announcing today has the potential to significantly increase the core value of our Moroccan acreage and to establish Eastern Morocco as a prolific but low cost gas province, on the doorstep of large and growing energy markets."
Sound Energy and its partners hold significant gas exploration acreage in Eastern Morocco, which the Company internally estimates to include a total of 1.03 Tcf gas originally in place ("GOIP") over the greater Tendrara, TE-5 Horst and Lakbir and TE-4 highs (consisting of a mid-case 0.63 Tcf GOIP on the TE-5 Horst and an additional 0.4 Tcf unrisked GOIP over the Lakbir High and the TE-4 high). A reserves certification is currently underway on the TE-5 Horst core volumes of 0.63Tcf GOIP.
In addition to the Company's geophysical programme of a combination of aerial gravity gradiometry, 2D seismic surveys, 2D seismic reprocessing and geological studies, the Company now intends to accelerate its exploration drilling programme with a view to rapidly and materially increasing its discovered volumes in Eastern Morocco, thereby significantly increasing the core value of the Moroccan acreage and enabling right-sizing of the planned facilities.
The new exploration programme in Eastern Morocco includes three wells to be drilled back to back and will target high impact locations with significant exploration potential, with the aim of further unlocking the Company's internally estimated unrisked gross GOIP exploration potential volumes across Sound Energy's Eastern Moroccan acreage of 17 Tcf mid case (31 Tcf upside case and 9 Tcf low case), as announced on the 1 February 2017.
These exploration wells will span multiple target types across structural and stratigraphic traps and Triassic and Paleozoic reservoirs, and each of the wells is expected to cost approximately US$10 million.
The anticipated targets of the three well programme and the Company's internally assessed volume estimates (gross unrisked GOIP) of each of those targets are as follows:
· The 'A' Structure (25km north-west of TE-5 Horst) targeting a 0.7 Tcf mid case with a 1.2 Tcf upside case and a 0.4 Tcf low case, all from the Triassic and a similar sized lead in the Paleozoic.
· North-east Lakbir (20km north-east of TE-5 Horst) designed to target the TAGI stratigraphic pinch-out play, with estimated volumes of 2.6 Tcf mid case, a 5.0 Tcf upside case and a 1.2 Tcf low case.
· A Paleozoic test beneath the TE-5 Horst.
The previously announced appraisal well evaluation will remain under review pending completion of the exploration drilling programme.
The exploration drilling programme leads will be reviewed again and high-graded towards the end of the year following receipt of the gradiometry, 2D seismic surveys, the 2D seismic reprocessing and the geological studies.
The Company cautions that general exploration in the oil and gas industry contains an element of risk and there can be no guarantee that its current estimates of volumes of gas originally in place will be substantiated by exploration drilling or would actually be available for extraction.
* the term 'unrisked' refers to exploration estimates of gross GOIP where no subsurface CoS (chance of success) has been applied.
For further information please contact:
Vigo Communications - PR Adviser
Tel: +44 (0)20 7830 9700
James Parsons, Chief Executive Officer
Smith & Williamson - Nominated Adviser
Tel: +44 (0)20 7131 4000
RBC Capital Markets - Broker
Tel: +44 (0)20 7653 4000
The information contained in this announcement has been reviewed by Sound Energy's Executive Vice President, Brian Mitchener, a chartered petroleum geologist. The Company's internal estimates are made in accordance with SPE standards.
Tcf means trillion standard cubic feet of gas.