Sound Energy's A1 resource estimate good, success rate bad

Morocco-focused upstream gas company Sound Energy has received preliminary volume results a recent Competent Person's Report on its A1 prospect on the Tendrara-Lakbir permit.

The CPR from RPS Energy Consultants stated that at a low-case the A1 reservoir held 278bn cubic feet, 624bcf at a mid case and 1.24trn cubic feet at a high case.

This largely confirmed the AIM-quoted company's previous estimates for gas originally in place of 0.7 tcf, however, the operation's success rate of 25% was enough to concern investors, as shares went red in early trading on Thursday.

Sound believes that further work may de-risk the first well and the chance of success may increase on positive results from the seismic processing and geological studies.

Sound intends for TE9, its first well, to target both the TAGI and deeper Paleozoic structures, however, the firm highlighted that the scope of the CPR was designed to cover just the Triassic TAGI reservoir, noting that any future volume estimates for the deeper Paleozoic prospectivity would need to be added to RPS' study volumes.

The CPR was expected to be issued in its final form in May and will include a full technical review of the A1 prospect.

As of 0850 BST, shares had lost 3.41% to 42.98p.