Sound Energy sees its Moroccan gas sales plan with ONEE moving forward

British upstream gas company Sound Energy PLC has signed a preliminary deal on the sale of its gas production from Morocco’s Tendrara concession with the country’s Office National de L’Electricité et de L’Eau Potable (ONEE).

Sound Energy and ONEE signed, Tuesday, a memorandum of understanding (MoU), the state power company said in a communiqué sent to Yabiladi. It also reported that negotiations are underway on gas sales agreements. The latter is seen as a «critical next step» for the British firm which has been in talks with ONEE since the beginning of this year, Energy Voice said.

The preliminary agreement «covers the first 500 million cubic meters per year of production, around 1.37 mcm per day», the same source said, adding that the gas sales agreements may «cover up to 1.7 mcm per day, which is the mid-case production rate under the field development plan».

The gas sales agreements are expected to last for 10 years, according to the MoU, and would be automatically renewed in five years. Terminating the agreements, however, requires a one-year notice.

In May, Sound Energy announced that its shares rose after it told investors that it received an offer from the Moroccan government.

Sound Energy, which has three assets in the Kingdom (Tendrara, Anoual, and Sidi Mokhtar), said at the time that a non-binding offer submitted by ONEE aims to purchase its Tendrara’s gas.