SDX Energy posts record production in 2020; EBITDAX climbs 39%

Oil and gas company SDX Energy has reported record production, higher net revenues and a 39% increase in EBITDAX in 2020.

Net revenues grew to $46.1 million during the year, up from $34.8 million in 2019, while EBITDAX climbed to $32.9 million in the 12 months ended 31 December 2020.

The company announced average entitlement production of 6,397 boe/d, up 57% year on year, attributable to strong production levels, mainly from South Disouq, at 49.5 MMscfe/d equating to 4,532 boe/d net to SDX.

It said that 2020 production from core assets either exceeded or was at the top end of market guidance, despite COVID-19 'interruptions' in Morocco, while capex was below guidance, primarily as a result of drilling at West Gharib being deferred due to the lower oil price environment.

SDX Energy posted netback of $36.5 million, 29% higher than in 2019, citing a full year of production from South Disouq, although Morocco netback was higher, reflecting a strong recovery from COVID-19 shutdowns.

West Gharib experienced lower production due to increased water cut and lower oil service fee realisations as a result of lower oil prices in 2020. It reported that operating expenses were $2.9 million higher predominantly due to a full year of South Disouq operations, partly offset by cost savings and lower workover activity at West Gharib.

Chief executive Mark Reid said: 'Operationally, 2020 was a strong year for the group and although the COVID-19 pandemic contributed to a low oil price environment, SDX's high fixed-price gas assets in both Egypt and Morocco demonstrated the cash-generative resilience that exists within our portfolio.

'While Morocco production saw demand fluctuations early in the period, we are now back to pre-lockdown levels of production with 2021 production expected to be 8-12% higher than in 2020.'

At 9:25am: (LON:SDX) SDX Energy Inc. share price was 0p at 15.25p