Zenith Energy Ltd Joint Venture Agreement for acquisition (1871S)
July 07 2020 - 2:30AM
UK Regulatory
TIDMZEN
RNS Number : 1871S
Zenith Energy Ltd
07 July 2020
July 7, 2020
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 ("MAR"). Upon
publication of this announcement via a regulatory information
service ("RIS"), the inside information contained in this document
is now considered to be in the public domain.
ZENITH ENERGY LTD.
("Zenith" or the "Company")
Joint Venture Agreement for acquisition of second oil production
asset in the Republic of the Congo
Zenith Energy Ltd. ("Zenith" or the "Company") (LSE: ZEN; OSE:
ZENA-ME), the listed international oil & gas production company
focused on pursuing African development opportunities, is pleased
to announce that it has entered into a joint venture agreement (the
"Agreement") with a local oil & gas company in the Republic of
the Congo.
The primary objective of the Agreement is the potential
acquisition of an onshore oil production licence (the "Potential
Acquisition"), last producing at a rate of approximately 300
barrels of oil per day from the regionally proven Mengo formation
as recently as 2019. Production has currently been suspended
pending the assignation of a new licence.
The Potential Acquisition is located in the Kouilou region of
the Republic of the Congo in proximity of Pointe-Noire, the
country's second largest city, and is also in the vicinity of
Tilapia, the Company's recently acquired oil production asset with
transformational production potential.
Under the terms of the Agreement, the Company and its local
partner will jointly submit an application to the relevant
authorities in the Republic of the Congo, including the Ministry of
Hydrocarbons, for the award of a new licence in relation to the
Potential Acquisition.
Further, in accordance with the Agreement, it is stipulated that
Zenith shall have the role of joint operator and majority partner
in the event that a new licence is successfully obtained in
relation to the Potential Acquisition.
Following preliminary technical analysis of the Potential
Acquisition, as part of the due diligence activities conducted
prior to entering into the Agreement, Zenith is confident that
profitable oil production operations can be achieved following the
reactivation of the Potential Acquisition and the performance of
targeted, low-intensity workover activities.
The Potential Acquisition is in line with the Company's strategy
of identifying near-term production and development assets in
Africa which have material, near-term production potential.
Andrea Cattaneo, Chief Executive Officer, commented:
"As is known by shareholders, the Company's senior management is
currently in the Republic of the Congo conducting negotiations with
the relevant authorities for the attribution of a new 25-year
licence in relation to the highly prospective Tilapia asset.
Our presence in the cities of Pointe-Noire and Brazzaville, the
capital of the Republic of the Congo, has facilitated access to a
number of compelling domestic opportunities, which have become even
more commercially attractive in view of the recent decline in oil
prices.
The Potential Acquisition has two key qualities that render it
highly compatible for our portfolio: near-term profitable
production potential and significant development potential to
progressively maximise production on account of the potentially
highly significant oil reserves in place which will require
independent evaluation under Canadian National Instrument
51-101.
I look forward to further updating shareholders in due course on
our exciting progress in the Republic of the Congo."
Further Information:
Zenith Energy Ltd
Andrea Cattaneo, Chief Executive Officer Tel: +1 (587) 315 9031
----------------------------
E-mail: info@zenithenergy.ca
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Notes to Editors:
Zenith Energy Ltd. is an international oil and gas production
company, listed on the London Stock Exchange (LSE:ZEN) and the
Merkur Market of the Oslo Stock Exchange (ZENA:ME).
Zenith's development strategy is to identify and rapidly seize
value-accretive hydrocarbon production opportunities in the onshore
oil & gas sector, specifically in Africa. The Company's board
of directors and senior management team have the experience and
technical expertise to develop the Company successfully.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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