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SDX Energy PLC entered non-binding Heads of Terms with DIKA MOROCCO AFRICA (DMA) for gas prepayment, with an initial draw down of approximately $2 million planned by September 30, 2023. A further Heads of Terms for a larger prepayment is expected to be agreed and funds drawn by early 2024. Additionally, SDX Energy PLC drew down a further $500k from a Convertible Loan.
| Date | 13 Sept 2023 |
| Time | 07:00:05 |
| Category | Acquisitions and alliances |
| ID | 2337M |
13 September 2023
SDX ENERGY PLC ("SDX" or the "Company")
GAS PREPAYMENT AGREEMENT
Highlights
· Gas Prepayment Heads of Terms ("HoT") agreed with Citic Dicastal subsidiary, DIKA MOROCCO AFRICA ("DMA"), for Q4 gas supplies
· Prepayment amount of c. $2million planned to be drawn down by 30 September 2023
· Additional HoT for a larger prepayment transaction to be agreed and planned to be drawn down by early 2024
The Company is pleased to announce that it has entered into a non-binding HoT with DMA, its largest offtaker, to prepay for SDX's gas deliveries in Morocco. The initial terms of the agreement envisage draw down of c. $2 million by the end of September 2023. These funds are planned to be used towards the drilling costs of the KSR-21 well.
A further heads of terms for a larger prepayment amount is currently under negotiation and is expected to be agreed and funds drawn by early 2024. The Company plans to direct this second prepayment towards funding a further multi-well back-to-back drilling programme. As mentioned in the Company's announcement of 4 September 2023, this type of back-to-back drilling, which allows development of gas behind pipe (booked reserves), further increases operational efficiency, reduces costs and ensures that immediate and future demand can be met.
The Company also announces that it has drawn down a further $500k from the Convertible Loan, as announced on 27 July 2023.
Daniel Gould, the Managing Director, commented:
"These Heads of Terms testify to the deepening of the long-standing partnership between SDX and DMA, as well as Citic Dicastal more broadly. SDX has been supplying gas to DMA in Morocco for over five years and is committed to continuing to be a sustainable partner for its energy needs. This partnership is mutually beneficial for SDX, DMA, and supports the growth of industry in Morocco."
About DMA
· DMA is a 100% subsidiary of Citic Dicastal - world leader in automobile part manufacturing and the 50th largest auto supplier in the world.
· Citic Dicastal is a subsidiary of Citic Group - a Chinese holding company with a corporate portfolio approaching $1 trillion.
For further information:
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SDX Energy Plc Daniel Gould, Managing Director William McAvock, Chief Financial Officer Tel: +44 (0) 20 3219 5640
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Shore Capital (Nominated Adviser and Broker) Toby Gibbs/Iain Sexton Tel: +44 (0) 20 7408 4090 |
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InHouseIR (Investor and Media Relations) Sarah Dees/Oliver Clark Email: sdx@inhouseir.com Tel: +44 (0) 78 8165 0813 / +44 (0) 20 3239 1669
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Camarco (PR) Billy Clegg/Owen Roberts/Violet Wilson Tel: +44 (0) 20 3757 4980
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About SDX
For further information, please see the Company's website at www.sdxenergygroup.com or the Company's filed documents at www.sedar.com .
Forward-looking information
Certain statements contained in this press release may constitute "forward-looking information" as such term is used in applicable Canadian securities laws. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or are not statements of historical fact should be viewed as forward-looking information. In particular, statements regarding future drilling developments at KSR-21 should be regarded as forward-looking information.