SDX Energy has launched its delayed Morocco drilling programme at the Lalla Mimouna Sud concession with the spudding of the SAK-1 exploration well.
The company began drilling the well on August 6. The SAK-1 is targeting the Guebbas formation, at a measured depth of around 1,108 metres. Drilling this well will complete SDX’s commitments on the concession.
SDX said this is the first of a two-well campaign on the company’s acreage in the Gharb Basin in the third quarter. It may opt to drill another three wells, later this year and into early next year, depending on its drilling results and customer demand.
The company has previously said it would drill up to seven wells in Morocco.
SDX CEO Mark Reid said the SAK-1 was intended to “add reserves to allow us to continue supplying gas to our customers in line with their contractual requirements. Success at SAK-1 would also open a new exploration area for us to the west of our existing production hub, with several follow-up prospects already having been identified.”
If SDX is successful it would aim to connect wells to local customers within nine to 12 months of discovery.
The company has a 75% stake in four Moroccan concessions. In early August, SDX published a trading update saying it planned to spend around $12.5-13 million in Morocco this year. It spent only $3mn in the first half in the country.
Moroccan volumes fell in the first half of the year, to 5.1 million cubic feet per day gross. The company expects this to remain flat over the rest of 2022. In 2021, it produced 7.7mmcf per day. SDX has attributed this to the ending of a supply contract.
SDX shareholders recently rejected a takeover offer from Canada’s Tenaz Energy. Support in favour of the combination was just 55.88%, with 44.12% against. For the deal to go ahead it would have required 75% in support.