SDX Energy PLC on Thursday said it received around $1.9 million from Dika Morocco Africa as part of a gas prepayment heads of terms announced in September.
The London-based energy company, which currently has a portfolio of exploration, development and production assets in Egypt and Morocco said the funds will be primarily used to pay the cost of drilling the KSR-21 well in Morocco, SDX Energy said.
Shares in SDX Energy were up 17% to 4.38 pence each in London on Thursday morning.
SDX Energy said the pre-payment showed evidence of a ‘deepening partnership’ between SDX Energy and Citic Dicastal.
Dika Morocco Africa is a 100%-owned subsidiary of Citic Dicastal, which in turn is a subsidiary of Citic Group, a Chinese holding company with a corporate portfolio approaching $1 trillion.
SDX Energy noted Citic Dicastal as its largest offtaker with an ‘increasing and immediate’ demand for SDX Energy’s gas.
On Thursday last week, SDX Energy said the SR-21 well reached a total vertical depth of 1,955 metres, with drilling data confirming the presence of gas-charged sands in the targeted reservoir section.
Earlier in September, when the prepayment heads of terms was announced, SDX Energy said a further heads of terms for a larger prepayment amount was under negotiation with Dika Morocco Africa. It said it expected this to be agreed by early 2024, with funds drawn at that point.
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