Capricorn Energy PLC (LSE:CNE, OTC:CRNZF) shares gained over 14% in Tuesday’s early deals as investors eyed a bonus cash payout, due early next year.
The company told investors that it is expecting a contingent payment between $25 million and $50 million in 2025, now that the Sangomar field development, offshore Senegal, has seen its first production.
Under the terms of Capricorn’s asset sale deal with Woodside Petroleum, the company is due the milestone payment based on the average oil price over the field’s first six months.
It will be due $25 million if the average Brent crude price is above $55 per barrel, or $50 million will be due if the average price is above $60.
The company said it expects payment in early 2025, once the average price has been determined.
As previously communicated, the company intends to return any available proceeds of this contingent payment to its shareholders.
Capricorn noted that, under its agreement with Woodside, it is responsible for certain taxes arising in connection with the sale of the PSC interests, and, a tax audit of Capricorn's disposal of the assets is ongoing.