SDX Energy ready to press on with development after $10m fundraising

North Africa-focussed oil and gas company SDX Energy confirmed significant progress on Friday, announcing the completion of its $10m fundraising and admission to AIM of the new common shares.

The AIM-traded firm had initially announced the fundraising, through a private placement with “certain existing institutional investors”, on 6 September.

At the time, it said the fundraising was completed by way of an oversubscribed simultaneous placing of, and direct subscription for, 17,559,455 new common shares at 43.75p per share.

It said the new shares represented 9.4% of the company's pre-fundraising issued share capital.

The fundraising included a “significant subscription” by MEA Energy Investments, an existing 15.6% shareholder, taking its shareholding to 19.1%, the board confirmed.

“The net proceeds of the fundraising will be used to accelerate the company's exploration and appraisal programme at its South Disouq asset in Egypt and its development programme across its Moroccan acreage, whilst retaining a prudent level of liquidity,” the board said in a statement.

It had previously outlined its plans for after completion of the fundraising, which included the completion of “all development activities” on South Disouq, taking the discovery to first gas in the first quarter of 2018.

It said it would drill two additional exploration wells in South Disouq targeting 150 bscf, and drill two additional development wells in Morocco, increasing the Moroccan drilling programme to seven development wells and two exploration wells.

The company also said it would undertake a “potential 3D seismic programme” in Morocco to identify further drilling opportunities in 2019.

“On completion of these activities, the company expects to see its cash resources grow from the second half of 2018, reflecting the commencement of first gas sales in South Disouq and the connection of new gas sales customers in Morocco.”