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Friday, March 11, 2016
Further to the Heads of Terms announced by the company in January, Sound Energy purchased PetroMaroc’s 50% working interest in, and operatorship of, the Sidi Moktar licenses. On completion of the acquisition, Sound Energy will issue 21,258,008 new ordinary shares in the company to PetroMaroc as consideration and will also issue PetroMaroc a 10% net profit interest in any future cash flows from the Kechoula discovery, and a 5% net profit interest in any future cash flows from structures within the Sidi Moktar Licenses other than the Kechoula discovery.
Following the acquisition, Sound will hold 75% of the Sidi Moktar licenses through its 100% owned UK incorporated intermediate holding company, Sound Energy Morocco South.
Sound also signed Heads of Terms with Culebra Petroleum for the sale of 66.67% of Sound Energy Morocco South, which will effectively entitle Culebra Petroleum to 50% working interest in the Sidi Moktar licenses. Sound Energy Morocco South is currently 100% owned by Sound and its only assets are Sound Energy’s 75% interest in, and operatorship of, the Sidi Moktar licenses.
As consideration for the acquisition by Culebra Petroleum of 66.67% of Sound Energy Morocco South, Culebra Petroleum will, subject to contract: pay the Sound $6 million in cash; commit to an investment program on the Moroccan licenses up to a value of $18 million, which will include a carry to Sound Energy of up to $4.5 million; and assume 90% of the net profit interests granted to PetroMaroc as part of the acquisition (leaving Sound Energy to pay the remaining 10%).
Sound Energy Morocco South will remain operator of the Sidi Moktar licenses with both Sound Energy and Culebra Petroleum jointly staffing all operations.
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