17th Aug 2020 12:58
(Alliance News) - Cairn Energy PLC on Monday said Woodside Petroleum Ltd has exercised its rights to buy the FTSE 250 firm's stake in the Sangomar field offshore Senegal.
The move means Woodside has effectively blocked the USD400 million agreement by Russia's PJSC Lukoil to buy Cairn's roughly 40% stake in the asset. The deal with Lukoil was announced by Cairn back in July.
Woodside is the operator of the Sangomar asset and already holds a 35% stake. It will pay USD300 million plus working capital adjustments for the Cairn holding. A further USD100 million could come Cairn's way, depending on first oil and Brent prices.
Woodside in June said Sangomar's progress was not affected by Covid-19 and first oil is still expected in 2023.
Cairn said that if no other joint-venture parties pre-empt before the August 26 deadline, Woodside will acquire its stake, giving it 75% control.
"The transaction remains subject to government of Senegal consent and Cairn shareholder approval," Cairn added.
Cairn shares were 0.4% higher at 141.50 pence each in London on Monday afternoon. In Sydney, Woodside shares closed down 0.4% to AUD20.37.
By Eric Cunha; [email protected]
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