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San Leon scraps Alpay takeover after delays, weak lira

Published 14/04/2014, 07:25

LONDON (Reuters) - London-listed shale gas explorer San Leon Energy dropped plans on Monday to buy a 75 percent stake in Turkish energy company Alpay Enerji, blaming delays in government approval and the strong devaluation of the Turkish lira.

"The company has determined that its capital will be better spent in Poland, particularly in the Baltic Basin," San Leon Energy said in a statement.

The company also said that reduced production potential of Alpay Energy's Hamman-1 well and a loss in customer numbers had also contributed to its decision not to proceed with the deal.

Deals in Poland, such as the company's arrangement with U.S. oil service firm Baker Hughes announced in February, had improved San Leon's cash flow position to a point where the Turkey deal was no longer needed, the company said.

(Reporting by Karolin Schaps; editing by Kate Holton)

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