11 Nov 16 – Delonex Energy, the privately owned London-based company, is set to sell its 50% stake in a Kenyan block, according to two sources briefed on the situation.
The deal will be announced in the coming weeks, they said.
Block 9, the target, is operated by Lundin Group backed Africa Oil [TSE:AOI], which also has the other 50% stake. Delonex acquired the stake in March from Marathon Oil [NYSE:MRO]. The deal value was not mentioned at the time.
Marathon Oil cited depressed market conditions and disappointing results from a second well drilled in Block 9 as the reasons for its exit. Issues have since arisen between Delonex and Africa Oil, and the two have not been able to decide on how best to take the development of Block 9 forward leading to Delonex’s exit move, the sources noted.
Hydrocarbon deposits were discovered on the prospect in 2014. Block 9 contains gross best estimate resources of 1.59m barrels of oil and 1.88bn cubic feet of gas, according to Africa Oil, which has a market cap of CAD 890.01m.
Delonex declined to comment.
By Katie McQue