Azonto Petroleum tanks on talks of potential merger or sale

Shares in Azonto Petroleum tanked on Tuesday, after the oil and gas group confirmed it was considering options leading to a sale or a merger.

The Australia-based company said it was currently undergoing a strategic review of its operation and that there was no guarantee that discussions with potential suitors would lead to either outcome.

Meanwhile, Gazelle, the group’s offshore gas development project in Ivory Coast, received a boost as state-owned utility provider CI-Energies signed a non-binding agreement with a “reputable” international firm which may finance, develop and operate the power project.

Azonto said that the proposed operator would also shoulder the cost of upgrading power line infrastructure for the project, adding it expected he full scope and schedule for the power project will be agreed by the end of May.

However, Gazelle could suffer delays as the Vioco Petroleum joint venture, in which Azonto owns a 35% stake, had chosen to re-launch a tendering process, after one of the contractors offered a higher-than-expected lump sum price for the project.

Azonto said the new tender was necessary to ensure it achieved a “realistic” breakeven gas price for the project.

Azonto shares were down 35.35% to 0.210p at 10:58 on Tuesday.