The Sound Energy PLC (LON: SOU) share price surged 21% after the transition energy company released its latest operations update and its new strategy for the future.
The company noted that its Tendrara Phase 1 mLNG development was progressing well after its Moroccan subsidiary Sound Energy Morocco East Limited (SEMEL) gave Italfluid Geoenergy S.r.l. the go-ahead regarding the projects concession area.
Since then, Italfluid has issued purchase orders for the gas processing and liquefaction packages and an LNG storage tank. The two firms have also commenced site preparation activities and have advanced site engineering activities.
Sound Energy also outlined the milestones it intends to achieve over the next six months, which resonated well with investors, given the rally in SOU shares. However, the shares had given up most of their gains at writing.
The transition energy company also updated its tendrara phase 2 project in the financing stages. Sound energy has received funding proposals from several Moroccan banks and mezzanine funds.
The interested parties have submitted non-binding term sheets. Sound Energy is currently examining the offers before deciding on which financiers it will partner with on the project.
Sound Energy further updated its exploration activities in Eastern Morocco, where the Trias Argilo-Gréseux Inférieur (TAGI) gas reservoir. The firm has identified multiple drilling opportunities in the license area.
The company also revealed that its renewable energy-focused subsidiary, Sound Energy Sustainables Limited (SESL), is currently in discussions with several Moroccan industrial-scale farmers near its Sidi Moktar exploration permits that could lead to the provision of 4.3MW of solar-powered electricity to the farmers.
Investors were happy to see that Sound Energy was making progress.
Graham Lyon, Sound Energy's Executive Chairman, commented: “We are pleased to announce these updates today following a period of concerted focus on the future strategy of the Company. The updates highlight the significant progress that Sound Energy has been making to put the key elements in place to create sustained shareholder value through the development of a cash generative, self-financing business centred around society's aspirations and Sound Energy's strategy to accelerate the energy transition. We are on a path to building a quality portfolio that fully reflects our aspiration to be a key player right across the energy transition landscape.”
Investors looking to acquire Sound Energy shares could have done so a few weeks ago, on March 16, 2022, when the shares bottomed after a significant downtrend. The next opportunity presented itself after the latest pullback to the 1.90p support level. I would buy at or near this level, with a stop-loss order at the 1.80p level.
*This is not investment advice. Always do your due diligence before making investment decisions.
Sound Energy share price.
Sound Energy shares rallied by 21% to trade at 2.30p, rising from Wednesday’s closing price of 1.90p.
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