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    SDX Projects Output Decline in 2021

Summary

The company expects production to fall this year because of maintenance work and other disruptions, following steep growth in 2020.

by: Joe Murphy

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Natural Gas & LNG News, Africa, Premium, Corporate, Exploration & Production, News By Country, Egypt

SDX Projects Output Decline in 2021

North Africa-focused SDX Energy has warned it expects production to decline in 2021 after steep growth last year, because of planned downtime at its central processing facility at the South Disouq field in Egypt, the company said on January 26.

The London-listed player expects to produce between 5620 and 5,920 barrels of oil equivalent/day this year. It extracted a record 5,987 boe/d in 2020, up from 4,062 boe/d in 2019 and 3,574 boe/d in 2018. Growth in previous years was driven by South Disouq's start-up in November 2019.

 The maintenance at South Disouq's processing facility was meant to take place in 2020 but was delayed because of the coronavirus pandemic. SDX also plans to install an inlet compressor and undertake several well workovers at the site in 2021 that were originally scheduled for last year. The company will look to synchronise these activities to reduce their impact.

South Disouq will continue accounting for the lion's share of SDX's output, flowing a projected 4,300-4,500 boe/d in 2021 versus 4,538 boe/d in 2020. Besides the compressor's installation, the company also plans to drill two wells and workover three more at the field his year. 

Production at the West Gharib oilfield in Egypt will see natural decline in the first half of this year, before a three-to-four well drilling campaign kicks off to arrest this trend. SDX will also drill a water injection well and upgrade facilities. Additional development wells are planned in 2022 and 2023, with the goal of returning output to 3,000 b/d, from a forecasted 2,350-2,650 b/d this year.

Gas extraction in Morocco is expected to pick up in 2021, averaging 874-915 boe/d, compared with 813 boe/d in 2020. The company plans to sink four or five wells in the country over the year, and conduct workovers and a well test.

SDX has set its capital expenditure at $25-26.5mn for this year, in line with last year's $25.5mn.