Cairn Energy sells Senegal stakes to Lukoil for $400m

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Simon Thompson, Cairn Energy chief executive

EDINBUGH-based Cairn Energy has sold its entire stake in a number of oil fields off the coast of Senegal to Russian firm Lukoil for $400m (£310m). 

The firm said it would return “at least” $250m to shareholders as part of a special dividend.

Under the deal, Cairn will sell its 40 per cent interest in the Rufisque Offshore, Sangomar Offshore and Sangomar Deep Offshore contract area.

The sale is expected to complete in the final quarter of this year, with Cairn to be paid $300m when it closes. 

Simon Thomson, Cairn Energy chief executive said: “We are proud of what Cairn has achieved in Senegal.

“With a strong balance sheet, low breakeven production and limited capital commitments, Cairn will have enhanced financial flexibility to invest in and grow the business whilst always remaining committed to returning excess cash to shareholders. 

“The planned special dividend from the sale of the Sangomar asset reflects Cairn’s long-standing strict capital allocation strategy of active portfolio management and returning cash to shareholders. 

We will work closely with the Government of Senegal, LUKOIL and joint venture partners to ensure the transaction is completed as soon as possible.”