Sound Receives Moroccan Pipe Funding Proposal

UK-based Moroccan gas explorer, Sound Energy, said September 4 it has received “an indicative non-binding commercial proposal” from the financial adviser to Moroccan fund OGIF and the latter's shareholders, relating to a vital 120km planned gas pipeline.

The UK explorer added that it expects OGIF to become a shareholder in Sound Energy “before the end of 3Q2017”. OGIF indicated July 2016 and this January that it will take equity in Sound, in return for which it and partners would fund the TGEP. Until completion, the funding proposal is non-binding.

The proposal is for funding of between $60mn and $100mn toward construction of the Tendrara Gas Export Pipeline (TGEP) – a key part of the planned field development project as it would connect Tendrara, in eastern Morocco, to the Gasoduc Maghreb-Europe export pipeline which connects north Africa to gas markets in southwest Europe. Sound said it estimates the gross cost of the TGEP pipe to be some $60mn for a 12-inch diameter pipeline and $100mn for a 20-inch pipeline.

Last month Sound announced it had received written confirmation that it would be allowed to build the 120km TGEP. OGIF’s adviser, which prepared the indicative proposal, is the Moroccan financial institution Advisory & Finance Group Investment Bank (AFG), founded 1999.

Mark Smedley