29 June 2018
Sound Energy plc
("Sound Energy" or the "Company")
Eastern Morocco: New Basin Model Suggests Anoual Oil Play
Sound Energy, the Moroccan focused upstream gas company, is pleased to confirm that it has now finalised a new geochemical and Basin Modelling study (the "Basin Model") across its Tendrara-Lakbir, Matarka and Anoual permits, Eastern Morocco (the "Eastern Morocco Portfolio").
The key conclusions from the geochemical study and Basin Model are:
· Hydrocarbon charge across the Eastern Morocco Portfolio is predominantly generated from a carbonate rich marine source rock, interpreted as of Devonian age.
· The Basin Model predicts that there is sufficient gas charge available to fill the high graded TAGI leads and prospects.
· The prediction of a potentially significant oil play within the Palaeozoic on the Anoual permit area (in addition to the Paleozoic gas play already identified). Further 2D seismic data is currently being acquired and processed over this play fairway, which is being evaluated as a candidate for the planned third exploration well (TE-11).
The Basin Model also enables the Company to provide estimated volumes for the range of hydrocarbons available for migration into mapped prospects and leads across the Eastern Morocco Portfolio and is an update on the work undertaken in early 2017. Preliminary volume estimates resulting from a previous basin model were first announced by the Company on 1 February 2017.
Following receipt of the Basin Model, the Company is pleased to update the Company's internally estimated volumes for the exploration potential** of the Eastern Morocco Portfolio acreage, expressed as unrisked gross gas originally in place, of a low case of 7 Tcf, a mid-case of 20 Tcf and a high case of 34 Tcf. This range represents further support of the previous estimates announced on 1 February 2017.
The Company commissioned the Basin Model from the leading independent petroleum systems analysis consultancy, Integrated Geochemical Interpretation Ltd (IGI). IGI built the model to assess the overall basin potential, to provide further data to derisk specific prospects and to evaluate the range of parameters that control the magnitude, phase and timing of hydrocarbon generation, expulsion and migration across the Eastern Morocco Portfolio areas.
The Basin Model utilises horizons derived from the recently acquired Full Tensor Gravity gradiometry (FTG) survey and new calibration data from the TE-6, TE-7 and TE-8 wells. The FTG data has been processed and interpreted to produce a series of permit wide surfaces that have been used to define the extent of the potential Paleozoic basins, the source of the hydrocarbons. The Basin Model has allowed the Company to model in 3-dimensions the evolution of the petroleum system, and migration of the hydrocarbons through time. The results of the modelling provide the Company with material to further derisk the extent of the Palaeozoic petroleum system across its Eastern Morocco acreage.
Whilst the new Basin Model is far more sophisticated than anything created previously for the Eastern Morocco Portfolio licence area, the Company cautions that its updated volume estimates are a product of the Basin Model. The modelling is reliant on a series of assumptions, and that notwithstanding the Company's internal estimates for the exploration potential of the Eastern Morocco Portfolio, it has so far only completed the first three wells in the Eastern Morocco Portfolio.
Brian Mitchener, Exploration Director, commented:
"I am delighted to report receipt of the final basin model and the potential for a new oil play in the Paleozoic over the Anoual licence. We expect this new oil play to be the target of our forthcoming third exploration well. In addition, this basin model significantly derisks the charge available to our individual prospects."
For further information please contact:
Vigo Communications - PR Adviser
Tel: 44 (0)20 7390 0230
James Parsons, Chief Executive Officer
Smith & Williamson - Nominated Adviser
Tel: 44 (0)20 7131 4000
RBC - Joint Broker
Tel: 44 (0)20 7653 4000
Macquarie Capital (Europe) Limited - Joint Broker
Tel: 44 (0)20 3031 2000
The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
* The Basin Modelling Study (the "Study") was prepared by Integrated Geochemical Interpretation Ltd, ("IGI") for the sole use of Sound Energy PLC. The Study is not a Competent Person's Report (CPR), a Qualified Person's Report (QPR) or a Technical Expert's Report (TER) and should not be relied upon as such. While the Study was prepared in good faith, using reasonable skill and care, reasonable assumptions, and professional judgement, it was based on an analysis of information provided by others (the accuracy and completeness of which, IGI has not been able to fully verify). The Study is predictive and forward-looking in nature and is based on opinions and professional judgement, so it is subject to various unknowns, including the inherent uncertainties in the interpretation of geological and technical data. The Study should, therefore, not be considered to be a definitive, complete or accurate statement of hydrocarbon resource or any guarantee of results or performance. IGI accepts no liability whatsoever for any errors or omissions in the Study (or for any responsibility for updating the Study, should further information become available). Integrated Geochemical Interpretation Ltd (www.igiltd.com) is a UK based consultancy providing geological interpretation services to the upstream oil and gas industry.
** The total potential ("Total Potential") of the acreage is an estimated range of unrisked gross GOIP derived from the Basin Model. The Total Potential represents the total amount of hydrocarbon (gas plus the gas equivalent volume of oil) that could be available for trapping, across the whole licence area of approximately 23,432 km2. The Total Potential is a stochastic range, based on estimates of the total generated and expelled hydrocarbon from three source rocks (Silurian, Devonian and Lower Carboniferous), since the Mid Permian (approximate age of the end of the Hercynian orogeny at 268 million years ago). The total expelled hydrocarbon estimates are converted into Total Potential estimates by assuming only 1%, 3% and 5% of the expelled hydrocarbon is available to be trapped. This assumption is consistent with the assumptions used for the preliminary basin model, announced on 1 February 2017.
Tcf means trillion cubic feet