Rabat - Sound Energy, a London-listed company, announced on Wednesday extending the negotiation period for the financing of the gas production under the Tendrara license in North East Morocco.

The company first announced reaching a deal with Morocco’s largest banking group Attijariwafa Bank to fund Phase 2 of the development of its 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.” In the new update, Sound Energy announced extending the negotiation period to April 28, 2023.

The deal covers MAD 2.25 billion (approximately $215 million) that would go to finance parts of Phase 2 of the Tendrara gas production. The overall development cost of Phase 2 is set at $330 million.

“Significant progress is being made” with Attijariwafa Bank, Sound Energy announced in a statement, explaining that the Moroccan bank recently completed legal and technical due diligence in accordance with the proposed financing.

The statement further explained that the two parties “have now moved on to more detailed financial structuring of the proposed Financing, particularly in respect of taxation.”

Commenting on the development of the negotiations, Sound Energy’s Executive Chairman, Graham Lyon, said that the Phase 2 financing agreement “is continuing to move forward favorably.”

Lyon explained: “It is a significant and complex undertaking for all parties involved, and I am pleased that the level of engagement that we have with Attijariwafa bank and our respective legal, tax, and technical advisors is very collaborative and positive.”

The Sound Energy executive further noted his confidence that all stakeholders will support the construction of a “robust, well-structured financing arrangement.”

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