Morocco Gas: Drilling Flop, No Cash, Fire Sale

Amid rapidly-dwindling cash reserves, the management of London-based Morocco-focused minnow Sound Energy are looking to secure a near-term sale of either the company or its Moroccan assets, essentially the same thing.

On 22 May Sound announced that it had appointed Rothschild & Co “to market its Eastern Moroccan portfolio with a view to assessing a sale, prior to FID.” The previous day Sound announced that following disappointing drilling results from the first two wells of a three-well program cash reserves had fallen to just $14mn. As a result Sound canned the third well and immediately implemented a “structural cost reduction program” focused on cutting wages and laying off staff. This is “expected to result in an annualized reduction in general and administrative expenses of over 50%.” (CONTINUED - 389 WORDS)