Cairn Energy to pay special dividend after agreeing sale of Senegal assets

Cairn Energy said on Monday that it has agreed the sale of its Senegal assets to Lukoil for $400m in cas and announced plans for a special dividend.

The company has agreed to sell its entire 40% interest in the Rufisque Offshore, Sangomar Offshore and Sangomar Deep Offshore ( RSSD) Contract Area, including the Sangomar development, offshore Senegal. Following completion of the sale, it plans to return at least $250m to shareholders.

Cairn said the deal is consistent with its "disciplined approach" to portfolio management and capital allocation and long-term strategy to return capital to shareholders. It also said the sale will enhance its financial flexibility to sustain and grow a "balanced and robust portfolio" during current challenging and uncertain oil market conditions.

Chief executive Simon Thomson said: "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."

At 0813 BST, the shares were up 5.9% at 131.80p.