Sound Energy, the African and European focused upstream gas company, is delighted to announce the signature of binding heads of terms with Schlumberger which will expand Sound Energy's relationship with Schlumberger into Meridja and the Tendrara relinquished area(s) in exchange for a full carry on Sound Energy's forthcoming Eastern Moroccan geophysical survey programme, estimated at US$27.2 million and subject to completion of the Company's recently announced acquisition of these interests from Oil & Gas Investment Fund S.A.S.
The binding heads of terms will, subject to contract, result in the extension of the existing Field Management Agreement between the Company and an affiliate of Schlumberger Oilfield Holdings Limited (the "FMA Extension") to include Meridja and the area(s) of Tendrara relinquished in accordance with the Morrocan Hydrocarbon Code (the "Tendrara Relinquished Area(s)"). Under the FMA Extension, subject to contract, Schlumberger will be granted a 27.5% working interest in the Meridja area and a 27.5% working interest in the Tendrara Relinquished Area(s).
In exchange, Schlumberger has agreed to contribute services in kind to cover the agreed scope of the Company's forthcoming Eastern Moroccan geophysical programme and to cover its pro rata share of costs thereafter. The Eastern Moroccan geophysical programme includes the acquisition and processing of approximately 2,600 kilometres of new 2D seismic and 24,000 square kilometres of Gravity Gradiometry. The seismic acquisition programme will cover the TAGI and Paleozoic across the Tendrara and Meridja areas.
The Company plans to complete the programme over a twelve month period in stages, with each stage outputting an updated prospect inventory which will undergo review by an independent competent person.
An update on the Company's Extended Well Test at TE-7 and the results of the ongoing TE-8 laboratory testing will be provided, as appropriate, in due course.
This announcement is inside information for the purposes of Article 7 of Regulation 596/2014.
James Parsons, the Company's Chief Executive, commented:
"We are delighted to introduce Schlumberger into Meridja and the relinquished area(s) whilst also securing a full carry on the forthcoming seismic programme. The extension of the Field Management Agreement will further deepen our strategic relationship with Schlumberger, who share the Company's view of our Eastern Morocco potential and frees up cash to allow us to accelerate our exploration of the region."