SDX company announced that its entitlement production recorded 8,061 barrel of equivalent per day (boe/d) which is increased by 117% during Q1 2020, compared to 3,715 boe/d produced in Q1 2019 despite coronavirus outbreak, according to a press release.
The company stated that these strong production levels were driven by the performance of South Disouq which came ahead of expectations by achieving a gross production of 51.4 million standard cubic feet per day (mmscf/d) of dry gas and 551 billion of condensate per day equating to 4,994 boe/d net to SDX.
SDX added that its netback increased by 30% to $12.1 million in Q1 2020, compared to $9.3 million in the same period 2019. This resulted from a full quarter of production above expectations from South Disouq and high consumption levels in Morocco until the lockdowns took place due to COVID-19.
The company explained that South Disouq asset has performed above expectations during Q1 and it has successfully drilled and completed a new production well in West Gharib, adding that it was tied into the field production system in April. Meanwhile, the results showed that North West Gemsa production was slower than the expectations due to the increase of water cut and fall of reservoir pressure.
Moreover, the company revised up its capital expenditures (Capex) guidance from $24.7 million to $28.2 million due to its strong performance, noting that coronavirus has not impacted Egypt’s production operations.
CEO of SDX, Mark Reid, commented saying that “The first quarter of 2020 proved to be a positive period for SDX against the backdrop of a challenging global economic environment. Production has been above expectations and I am pleased that our resilient business continued to generate cash from our oil and gas production as well as discovering new resource through the drill bit in both Morocco and Egypt.”
“Although we are currently living in a dynamic and fast-changing environment, it gives me great reassurance that approximately 90% of the company’s 2020 cash flows are expected to be generated from our fixed-price gas business. Disruption to our business as a result of COVID-19 has so far been minimal,” he added.