THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY SDX TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER
THE MARKET ABUSE REGULATION (EU) NO. 596/2014 ("MAR"). ON THE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION
SERVICE ("RIS"), THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.
LONDON, July 23, 2018 /CNW/ - SDX Energy Inc. (TSXV, AIM: SDX), the North Africa focused oil and gas company, is pleased to announce that a gas discovery has been made at its
SD-3X well in the South Disouq Concession, Egypt (SDX 55% working interest and operator).
The SD-3X well was drilled to a total depth of 7,842 feet and encountered 32.6 feet of net conventional natural gas pay in the
Abu Madi and Kafr el Sheik horizons, with an average porosity in the pay sections of 21.7%.
The SD-3X well will now be completed as a producer in the Abu Madi horizon and then tested after the drilling rig has moved
off location. In order to optimise the potential recovery from the SD-3X well, the Abu Madi horizon will be completed and
produced initially before re-entering the well to complete and produce the Kafr el Sheik horizon. The Abu Madi testing is
anticipated to commence between 30 and 45 days after the rig departs, depending on the availability of testing equipment.
Assuming a successful test in the Abu Madi, it is anticipated that the well will be connected to the infrastructure located
adjacent to the original SD-1X discovery, where production start-up is anticipated late in the 4th quarter of
2018.
Paul Welch, President and CEO of SDX, commented:
"The discovery of gas in both the Abu Madi and Kafr el Sheik horizons is a very positive outcome for the SD-3X well. As
demonstrated by the Ibn Yunus discovery earlier this year, the Kafr el Sheik horizon is an excellent quality productive sequence.
The SD-3X discovery has confirmed that this horizon is extensively present throughout the concession.
We will now analyse the data from all four wells drilled in the South Disouq campaign, as well as reprocessing and
inverting the existing 3D seismic we have on the concession. Upon interpretation of this data, and completion of the new 3D
survey later this year, we expect to identify further Abu Madi and Kafr el Sheik prospectivity for drilling in 2019 and
2020.
With our drilling activities completed, we will now focus on the completion of the South Disouq processing facility and
pipeline infrastructure with a view to achieving first production by the end of 2018."
About SDX
SDX is an international oil and gas exploration, production and development company, headquartered in London, England, UK, with a principal focus on North Africa. In
Egypt, SDX has a working interest in two producing assets (50% North West Gemsa & 50%
Meseda) located onshore in the Eastern Desert, adjacent to the Gulf of Suez. In Morocco, SDX has
a 75% working interest in the Sebou concession situated in the Rharb Basin. These producing assets are characterised by
exceptionally low operating costs making them particularly resilient in a low oil price environment. SDX's portfolio also
includes high impact exploration opportunities in both Egypt and Morocco.
For further information, please see the website of the Company at www.sdxenergy.com or the Company's filed documents at www.sedar.com.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as such term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward‐Looking Information
Certain statements contained in this press release may constitute "forward‐looking information" as such term is used in
applicable Canadian securities laws. Any statements that express or involve discussions with respect to predictions,
expectations, beliefs, plans, projections, objectives, assumptions or future events or are not statements of historical fact
should be viewed as forward-looking information. In particular, statements regarding the timing of completion and testing of
SD-3X, the connection of SD-3X to existing infrastructure, the start-up of production at South Disouq and the natural gas
potential of the South Disouq license, including the Company's ability to identify further prospectivity for drilling in 2019 and
2020, all should be regarded as forward-looking information.
The forward-looking information contained in this document is based on certain assumptions and although management considers
these assumptions to be reasonable based on information currently available to them, undue reliance should not be placed on the
forward-looking information because SDX can give no assurances that they may prove to be correct. This includes, but is not
limited to, assumptions related to, among other things, commodity prices and interest and foreign exchange rates; planned
synergies, capital efficiencies and cost‐savings; applicable tax laws; future production rates; the sufficiency of budgeted
capital expenditures in carrying out planned activities; and the availability and cost of labor and services.
All timing given in this announcement, unless stated otherwise is indicative and while the Company endeavors to provide
accurate timing to the market, it cautions that due to the nature of its operations and reliance on third parties this is subject
to change often at little or no notice. If there is a delay or change to any of the timings indicated in this announcement, the
Company shall update the market without delay.
Forward-looking information is subject to certain risks and uncertainties (both general and specific) that could cause actual
events or outcomes to differ materially from those anticipated or implied by such forward‐looking statements. Such risks and
other factors include, but are not limited to political, social and other risks inherent in daily operations for the Company,
risks associated with the industries in which the Company operates, such as: operational risks; delays or changes in plans with
respect to growth projects or capital expenditures; costs and expenses; health, safety and environmental risks; commodity price,
interest rate and exchange rate fluctuations; environmental risks; competition; ability to access sufficient capital from
internal and external sources; and changes in legislation, including but not limited to tax laws and environmental regulations.
Readers are cautioned that the foregoing list of risk factors is not exhaustive and are advised to reference SDX's Management's
Discussion & Analysis for the three months ended March 31, 2018, which can be found on SDX's
SEDAR profile at www.sedar.com, for a description of
additional risks and uncertainties associated with SDX's business, including its exploration activities.
The forward‐looking information contained in this press release is as of the date hereof and SDX does not undertake any
obligation to update publicly or to revise any of the included forward‐looking information, except as required by applicable law.
The forward‐looking information contained herein is expressly qualified by this cautionary statement.
Oil and Gas Advisory
Certain disclosure in this news release constitute "anticipated results" for the purposes of National Instrument 51-101 of the
Canadian Securities Administrators because the disclosure in question may, in the opinion of a reasonable person, indicate the
potential value or quantities of resources in respect of the Company's resources or a portion of its resources. Without
limitation, the anticipated results disclosed in this news release include estimates of pay thickness, and hydrocarbon content
attributable to the resources of the Company. Such estimates have been prepared by management of the Company and have not been
prepared or reviewed by an independent qualified reserves evaluator or auditor. Anticipated results are subject to certain risks
and uncertainties, including those described above and various geological, technical, operational, engineering, commercial and
technical risks. In addition, the geotechnical analysis and engineering to be conducted in respect of such resources is not
complete. Such risks and uncertainties may cause the anticipated results disclosed herein to be inaccurate. Actual results may
vary, perhaps materially.
Competent Persons Statement
In accordance with the guidelines of the AIM Market of the London Stock Exchange the technical information contained in the
announcement has been reviewed and approved by Paul Welch, President and Chief Executive Officer
of SDX. Mr. Welch, who has over 30 years of experience, is the qualified person as defined in the London Stock Exchange's
Guidance Note for Mining and Oil and Gas companies. Mr. Welch holds a BS and MS in Petroleum Engineering from the Colorado School of Mines in Golden, CO. USA and an MBA in Finance from
SMU in Dallas, TX USA and is a member of the Society of Petroleum
Engineers (SPE).
SOURCE SDX Energy Inc.
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