Edison Investment Research - Sea Dragon Energy Inc (SDX) SDX Energy - Strong netback; active 2019 well programme

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Edison Investment Research

Sanjeev Bahl

SDX Energy - Strong netback; active 2019 well programme

The acquisition of Circle Oil assets, strong oil prices and cost discipline drove up group operational netbacks from US$22.5/boe in H117 to US$32.9/boe in H118, with the group generating net cash from operations of US$20.3m. Funds from operations helped SDX Energy to support an active H118 drilling programme while maintaining a strong balance sheet position, ending the half-year with US$25.2m of cash and an undrawn credit facility of US$10m. As highlighted in our recent research note, Looking ahead at 2019 work programme, SDX remains on track to double production in 2018, while investing in an active E&A programme and development drilling in both Egypt and Morocco. Our valuation remains broadly unchanged at 92.7p/share (from 92.5p/share) as we include a slightly higher capex estimate for delivery of first gas at South Disouq.

30/08/2018 5 EN

Underlying

Sea Dragon Energy Inc

SDX Energy is engaged in the exploration, acquisition, development and production of oil and natural gas in Africa and Egypt. As of Dec 31 2010, total gross proved reserves for light and medium oil consisted of 3,593 thousand barrels ("mbbls"), natural gas liquids consisting of 211 mbbls and natural gas consisting of 2,575 million cubic feet.

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CA78410A1075 Canada

Provider

Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts

Sanjeev Bahl

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SDX Energy - Strong netback; active 2019 well programme

SDX Energy - Termination of coverage

SDX Energy - In an enviable position in the sector

SDX Energy - Sobhi sole risk delivered a commercial discovery

Record - AUME momentum and a sharper focus

Actinogen Medical - Funding in place through key catalysts

Henderson Opportunities Trust - A differentiated exposure to smaller companies

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