Mining, Oil & Gas News & Blog
The CEO Paul Welsh stated recently that  2015 and 2016 was a transformational period for the company. In October 2015, SDX Energy was created through the merger between TSX listed Sea Dragon Energy and private Madison PetroGas. The combination created SDX Energy, a stronger company with a stable financial base. We are fortunate to have a high margin production business, with significant growth potential, which has enabled us to remain profitable in the current market environment.

In May 2016, SDX Energy successfully obtained a dual-listing on the Alternative Investment Market (AIM) of the London Stock Exchange. As part of this process, we raised US$11 million through new and existing shareholders. These funds will be used to accelerate our growth plans and drive forward our active work programme particularly at Meseda and South Disouq. For the remainder of 2016 we seek to leverage our solid platform for growth and deliver material value for our shareholders.

This week Paul SDX revealed it will pay US$30mln to acquire Circle Oil’s assets in Egypt and Morocco. The deal will see SDX increase net production by almost 250% to 4,705 barrels oil equivalent per day. Reserves, meanwhile, rise by 64% to 12.03mln barrels oil equivalent.  Proactive reported that Paul said: ''For us it's a transformational deal ... it takes us up to a significant amount of production and most importantly it increases our yearly cash flow by $21mln - and that's what's attractive to us''.

Also SDX this week confirmed the acquisitive oil and gas firm has now closed a US$40mln funding to support its new deal.

The US$40mln fundraising which will support its new acquisition of Circle Oil’s assets in Egypt and Morocco. The transformative US$30mln deal will see SDX increase net production by almost 250% to 4,705 barrels oil equivalent per day. Reserves, meanwhile, rise by 64% to 12.03mln barrels oil equivalent.

As part of the deal, SDX also acquires a positive US$18.3mln working capital position (comprising US$1.9mln of cash, and US$16.4mln of ‘receivables less payables’). It is supported by a US$40mln funding, with new shares being issued through an accelerated book-build placing. As a result of the deal SDC increases its stake in the NW Gemsa field to 50%, from 10%, adding 2,600 boepd of net production to the group.

It also delivers a 75% stake in the Sebou and Lalla Mimouna which presently yield 750 boepd of net production and 3.8mln boe of reserves. The deal represents a significant discount – Circle’s creditors take 39 cents on the dollar for the group’s US$77.5mln debt – and SDX highlights that it is in keeping with its strategy that targets distressed production and development opportunities in North Africa alongside organic growth.
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