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5 February
2009
Lundin Petroleum AB ("Lundin Petroleum") is pleased to announce the
signing of an agreement for the sale of its wholly owned subsidiaries,
Lundin East Africa BV ("Lundin East Africa") and Lundin Kenya BV
("Lundin Kenya"), to Africa Oil Corporation ("Africa Oil").
Lundin East Africa holds Lundin Petroleum's interests in and
operatorship of production sharing contracts (PSCs) covering Blocks 2,
6, 7 and 8 in the Ogaden Basin region in the south of the Federal
Republic of Ethiopia ("Ethiopia") and covering the Adigala Area in
northern Ethiopia. Lundin Kenya holds Lundin Petroleum's operated
interest in the PSC for Block 10A and its non-operated interest in the
PSC for Block 9 in the Anza Basin region in the northwest of the
Republic of Kenya. The Africa Oil transaction also includes the transfer
of an option which Lundin Petroleum holds over Blocks 35 and M10-A in
the Somalia Democratic Republic, currently in force majeure.
Africa Oil is a Canadian oil and gas company with exploration interests
in East Africa. Africa Oil's shares are listed on the Toronto Stock
Exchange (Venture) under the symbol "AOI". Africa Oil is headquartered
in Vancouver, Canada and one of its major shareholders is related to the
Lundin family.
Africa Oil will pay Lundin Petroleum consideration of approximately USD
20 million, which will be funded through a loan from Lundin Petroleum to
Africa Oil maturing 31 December 2011 and bearing interest at USD
six-month LIBOR plus 3 percent. This loan will be convertible into
shares of Africa Oil on the basis of CAD 0.90 per share.
Completion of this transaction remains subject to all applicable
government and partner approvals.
Ashley Heppenstall, President and CEO of Lundin Petroleum comments "We
have been very successful over the past several years in building a
portfolio of exploration assets in East Africa. The strategy to grow our
business in East Africa was particularly driven by the prospectively of
our exploration acreage in Sudan. In view of last years disappointing
drilling results in Sudan, our East African acreage has less materiality
to us and as a result we have decided to divest our interests. Our
exploration efforts will continue to be focused on Norway, Russia and
South East Asia."
Lundin Petroleum is a Swedish independent oil and gas exploration and
production company with a well balanced portfolio of world-class assets
in Europe, Africa, Russia and the Far East. The Company is listed at the
Nordic Exchange, Sweden (ticker "LUPE").
For further information, please contact:
C. Ashley Heppenstall,
President and CEO
Tel: +41 22 595 10 00
or
Maria Hamilton
Head of Corporate Communications
Tel: +41 22 595 10 00
Tel: 08-440 54 50
http://www.lundin-petroleum
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