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Sound Energy may seek Italy exit in wake of disappointing well - analyst

Cantor analyst Sam Wahab reckons Sound Energy’s future will be in Morocco.

onshore drilling operation
Sound dropped off as much as 30% after a disappointing well

Sound Energy PLC’s (LON:SOU) management could seek to exit Italy in the wake of the disappointing well results and to avoid further bureaucratic fuss, according to Cantor Fitzgerald analyst Sam Wahab.

On Monday, Sound Energy’s share price dropped off as much as 30% after it revealed that the apparent gas discovery in Badile exploration well, near Milan, was likely to be sub-commercial.

In an interview with Proactive Investors Stocktube, Wahab highlighted that Sound Energy’s value has predominantly been created in Morocco, not Italy, and he suggested the sell-off in the shares had gone too far.

The analyst said: “to take a hit at the open of 30% was undue for them.”

Wahab, meanwhile, highlighted that Sound’s future would be in Morocco.

“I think Morocco is now going to be at the forefront of the company’s operations going forward,” he said.

“If you remember back to how difficult it was with the Italian bureaucracy in getting an exploration well down – planning permissions, approvals, environmental issues and things like that – I think the company might look to wash their hands of their Italian operations and focus solely on their operations in Morocco, where they’ve had huge success at Tendrara.”

Quick facts: Sound Energy PLC

Price: 1.0105 GBX

AIM:SOU
Market: AIM
Market Cap: £11.74 m
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