SHARES in Hurricane Energy surged from a low base after it struck a deal to buy back more than a third of $230 million of outstanding bonds at a discounted price, writes Scott Wright.

The oil and gas explorer, which in recent months has run into difficulties over its exploration activities West of Shetland, has agreed a $78m purchase price for 33 per cent of the outstanding convertible bonds due to be repaid in 2022, at a 78 per cent discount.

The company said the deal, which has a settlement date of September 15, will reduce the par value of the outstanding bonds to $152m.

Anthony Maris, chief executive of Hurricane Energy, said: “I am pleased that the company has been able to buy back more than 33% of the outstanding bonds.

“This will reduce the par value of bonds held by third parties to US $152m, utilising US $62m of net free cash (inclusive of accrued interest).

“The effect of this will save the company approximately US $22m of future obligations to bondholders in capital and interest.

“This is a positive development for the company in managing its outstanding debt.”

Shares closed up more than 8%, having climbed more than 20% during the session, at 2.7p.