SDX PLC produced 4,062 barrels of oil equivalent (boe/d) from its Moroccan concessions, which is a 24% year-on-year (YoY) increase in production, according to a press release.

SDX announced updates on its operational stats in Morocco in Q4 2019; where the company drilled nine wells, seven of which have shown promising discoveries; and completed well LMS-2 which is currently awaiting testing. In December 2019, SDX made five commercial discoveries which increased its natural gas reserves to six billion cubic feet (bcf) from 5.1 bcf.

OYF-2 well has been successfully tested and is expected to produce from 1.3-1.9 bcf of natural gas. As for BMK-1 well, it is set to be tested in the upcoming months and is expected to produce only 0.9 bcf of natural gas due to downhole issues. Additionally, the LMS-2 well in the Lalla Mimouna concession encountered a 10.6-meter net gas reservoir with 30.9% porosity. The well was completed and it will be tested to determine its potential when the coronavirus (COVID-19) travel restrictions are lifted.

Furthermore, the company spent $14.5 million for the Moroccan drilling campaign and $2.9 million for customer connections and compression facilities in Morocco in 2019.  SDX’s gas was sold to eight industrial users, for whom natural gas is integral to their energy supply and operations. It should be noted that three customers of SDX, which account for 50% of the total Moroccan revenues, have shut down their operations temporarily s a result of the COVID-19 pandemic.

“We feel it important to note that, after the restart of operations at our three Moroccan customers that are temporarily closed due to COVID-19 issues, we expect that with a Brent planning price of $35/bbl approximately 90% of 2020 and over 95% of 2021 forecast cash flows will come from our fixed price gas businesses, insulating us from much of the impact of falling oil price,” Mark Reid, CEO of SDX, commented.