Shares in Tullow Oil gained almost 5 per cent yesterday after the energy firm said it had sold an 11 per cent stake in the M'Boundi oil field in Congo for $435 million (€292 million). Laura Slatteryreports.
The cash deal, which will mean the sale of Tullow's Congo subsidiary to the Korea National Oil Company, is subject to approval from the government of the Congo.
Tullow chief executive Aidan Heavey said the sale of the field, which it acquired through the purchase of Energy Africa in 2004, gave the company the opportunity to focus its resources on core growth areas, including its new ventures in Ghana and Uganda.
The M'Boundi field was now entering a new phase of its development at a time when Tullow was looking to reallocate its capital resources to projects where it has "more material participation and influence".
The onshore M'Boundi field was discovered in May 2001, and is one of the largest to be found in Africa in recent years.
Commenting on the transaction, Davy Research said the price of the deal was equivalent to nearly $23 a barrel, and would result in an exceptional profit of around £145 million (€194 million), which would be completely tax efficient.
The proceeds will also reduce the company's net debt, according to Davy, which said it expected group production to be reduced by around 4,000 barrels a day to 68,500 barrels of oil equivalent a day for 2008.
The company is quoted on both the Irish and London stock exchanges and is a member of the FTSE 100 index.
It saw its share price rise by 4.75 per cent in London to close at 597pence.
