Attijariwafa Bank, Sound Energy Extend Negotiation for Gas Drilling Financing

Rabat – British energy firm Sound Energy announced on Thursday extending the negotiation period with Attijariwafa Bank regarding the financing of gas production under the Tendrara license in North East Morocco.

The energy company initially extended the negotiation period to April 28, 2023, for the parties to determine the deal’s binding terms. However, the Arranger Credit Committee consideration of the financing was delayed due to the Eid Al Fitr celebrations in Morocco, indicated Sound Energy in a statement.

For this reason, the two parties are unlikely to hold negotiations before the set deadline, added the statement.

“With Arranger Credit Committee consideration of the Financing re-scheduled, the parties continue to work in good faith in advancing the Financing and further announcements will be made, as appropriate in due course,” said the statement.

Sound Energy first announced reaching a deal with the Moroccan bank to fund the second phase of the development of the Tendrara production on June 23, 2022.

Under the agreement, Attijariwafa Bank was “to arrange a long-term project senior debt facility with a term of no more than 12 years.”

The deal covers MAD 2.25 billion (approximately $223 million) to partially finance Phase 2 of the development cost of the Tendrara gas production. The overall cost of Phase 2 is estimated at around $330 million.

“The Phase 2 senior debt process has completed its due diligence phase with recommendations to Attijariwafa Bank’s credit committee prepared by the Arranger,” said Graham Lyon, Sound Energy’s Executive Chairman.

Commenting on the development of the negotiations, Lyon said that the British firm is currently awaiting the conditioned financing offer, which they expect to receive shortly from the bank’s committee. “We look forward to providing further updates as the process moves forward,” he concluded.