Sound Energy receives financing from Attijariwafa Bank for gas field project in Morocco

Sound Energy PLC on Wednesday said that Casablanca-based Attijariwafa offered to finance the second phase of its development of the Tendrara production concession in Morocco.

The London-based Morocco-focused upstream gas company said Attijariwafa offered up to around $237 million, subject to conditions being met before the end of September.

The funding includes a 12-year term including a two-year grace period from first drawdown and a security package. The loan will be used to design, drill, construct and operate wells, a treatment facility, and a gas pipeline to transport and sell natural gas produced under the Tendrara production concession to Morocco’s National Office of Electricity & Drinking Water, among others.

Conditions for the financing include Moroccan governmental and ministerial approval, tax authority clearance of loan structure and amendment of gas sales agreement to lender satisfaction, Sound Energy said.

Executive Chair Graham Lyon said: “The majority of the conditions precedent to their offer are to be expected and as a result the company has been advancing a number of these for some time. We look forward to working with the arranger to conclude on what will be the first financing of its size for a gas field development in Morocco,” he said. ”

The negotiations for gas drilling financing between Sound Energy and Attijariwafa Bank began in June 2022, and after several extensions, the parties have now finalized the agreement.

Sound Energy currently holds a 75% interest in the gas drilling permit, while Morocco’s National Bureau for Hydrocarbons and Minerals (ONHYM) holds the remaining 25% interest.

Sound Energy shares were 6.2% higher at 1.49 pence each in London on Wednesday morning.