A project to produce gas has been collaborated on by Morocco and the UK. British energy company Sound Energy put out the concept, and Attijariwafa Bank opted to support it.

The project will improve the gas infrastructure in the Tendrara region of Morocco, which will result in major economic expansion, the creation of jobs, and greater investment.

The money will go toward pipeline construction, well drilling, and well-operation to deliver the natural gas to the buyer, the National Office of Electricity and Drinking Water.

The investment received a quick return because the news caused Sound Energy’s stock price in London to increase by 6.2%.

The firm and the Moroccan bank began talking on June 23 of last year. With a two-year grace period, the investment will be paid back over a period of 12 years.

The largest natural gas discovery in the Kingdom, worth an estimated 377,000 billion cubic feet, was made in the Tendrara region.

With a 28,000 square kilometer holding, Sound Energy is in possession of the country’s largest hydrocarbon exploration territory.

Presently, 10% of Morocco’s yearly gas consumption is fulfilled by the country’s 100 million cubic meter production. Through global marketplaces, the remaining demand is satisfied.

Prior to the expiration of the contract with Algeria, Morocco used the Maghreb-Europe Gas Pipeline to import gas from Algeria. However, Morocco switched to using the pipeline to receive liquefied natural gas from the European market via Spain.

Leila Benali, Morocco’s Minister of Energy Transition and Sustainable Development, claimed in an interview that new finds will result in a 300 million cubic meter boost in the nation’s natural gas output.

Thanks to the growth of the Tendrara and Larache districts, the Moroccan government expects to achieve 400 million cubic meters in the upcoming years, which would satisfy 40% of the nation’s energy needs.

Morocco is dedicated to boosting production and setting up the required infrastructure for gas supply from abroad in order to guarantee a stable local electrical system and satisfy the needs of energy-intensive sectors.

This plan will assist in balancing variations in the output of electricity from renewable sources.

Read Also: Sound Energy to Start Delivery of Liquefied Natural Gas in 2024

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A significant accomplishment for the British energy business Sound Energy is the announcement that its micro-liquefied natural gas (LNG) project at the Tendrara production concession in Morocco will begin to generate profits in the early months of 2024.

The London-listed firm announced its audited final results for 2022 in a press release, highlighting the fact that phase 1 LNG export is anticipated to begin in 2024.

The energy business stated that the main civil work, the foundations for the LNG tanks, was finished and tested in the first quarter of 2023.

With the micro-LNG development at Tendrara contractually scheduled to generate “maiden revenues” in early 2024, the company’s Executive Chairman, Graham Lyon, emphasized that 2022 was a year of “real tangible progress” for Sound Energy.

The energy company brought up the March 2022 Maghreb-Europe pipeline interconnection agreement with Morocco’s Hydrocarbons and Mines Office (ONHYM) with regard to the second stage of the development of the Moroccan Tendrara project.

In accordance with the contract, ONHYM gave its approval for the connection of the Tendrara Production Concession to the Maghreb-Europe pipeline via a gas export spur pipeline.

Although ministerial permission is still pending, the first “complementary period” of the Grand Tendrara exploration licences has started, according to the UK’s Sound Energy.

The business also declared that the exploration permissions for Sidi Moktar and Anoual would be extended for a another year, emphasizing that the choice is still pending ministerial approval.

While disruptive circumstances, such a tax battle with Moroccan authorities, hampered Sound Energy’s operations in 2022, engineering and production both advanced.

The business has handled its tax problems, enabling it to use its resources as efficiently as possible for field development.

“UK’s Sound Energy entered into a settlement agreement with Morocco’s tax authority on a phased payment schedule back ended over 6 years of approximately US$2.5 million as a full and final settlement against a claim of approximately US$23.95 million,” the business said in a news release.

Lyon underlined the “positive working relationship” the business has had with ONHYM, the government, and various contractors in Morocco.

Upstream gas business Sound Energy plc is based in London and has interests in Morocco.

After the Algerian government chose to shut down the Maghreb Europe pipeline, which provided Spain with Algerian gas through Morocco, the North African nation signed into a gas supply agreement with Sound Energy. Following Algeria’s severing of diplomatic ties with Rabat in August 2021 due to alleged “hostility” from Rabat, Rabat made the decision.

As part of the agreement, Sound Energy will feed the pipeline with gas, assuring Spain’s continued access to energy. With the country anticipating huge cash from gas exports, the decision also represents a significant boost for the Moroccan economy.

In accordance with the revival agreement, Sound Energy will provide gas to the pipeline for ten years.

Read Also: Nigeria-Morocco Gas Pipeline: Nigerian National Petroleum Corporation to Invest $12.5 Bln

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Sound Energy, a British company, revealed details of a 10-year agreement with the National Office for Electricity and Drinking Water to pump 350 million cubic meters of gas discovered in Tendrara into the “GME” pipeline, which was previously used by Algeria to export gas to Spain and whose ownership was transferred to Morocco.

“The gas sales agreement is an essential and long overdue milestone that will allow the firm to proceed development planning for the TE-5 Phase 2 project,” said Sound Energy CEO Graham Lyon. It also contributes to continuing conversations with potential finance partners.

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