Shares in oil producer Tullow Oil surged 24.8% today - their biggest daily percentage jump since June - after it said it had received Ugandan government approval for the sale of $575m of assets in Uganda to Total.
Tullow said it expects the deal to close in the coming days after completing certain customary pre-closing steps with France's Total.
Tullow in April agreed to sell its onshore oil fields in Uganda to Total as part of its efforts to raise $1 billion this year to reduce its $2.8 billion of debt.
Tullow, founded in the 1980s to tap into African oil and gas, suffered a series of technical difficulties and missed production targets, leading its chief executive to step down late last year.
Now, along with the entire oil industry, it faces unprecedented turmoil in the oil markets as lockdowns to contain the new coronavirus have wiped out demand.
The international oil price has also lost roughly two thirds of its value since the start of the year.
Money from the sale will be used to reduce Tullow's net debt, strengthening the balance sheet and moving Tullow towards a more conservative capital structure, it said.
Brokerage Peel Hunt says that the deal immediately reduces group's net debt by about 20% and gives Tullow the ability to pay down all maturing debt until 2022.
Shares of Tullow are down 74% this year as of last close.
