Zenith Energy in Negotiations for 'Material' West African Asset
Calgary-based independent E&P company Zenith Energy Ltd. has disclosed that it has entered into final stage negotiations with a West African national oil authority to secure a material oil production license. The company stated that following extensive due diligence, it believes an initial production rate of ~1,000 barrel of oil per day can be achieved via a rehabilitation programme on the license. Zenith estimates that the costs of such a programme will be repaid within a time frame of 2 to 3 months once production has successfully been restored (based on an oil price benchmark of US$40 per barrel). The company currently holds upstream interests in Azerbaijan and Italy, and is also in the process of acquiring additional assets in the Republic of Congo. It further stated that the West African acquisition is in line with its strategy of identifying near-term, existing production assets which do not require material upfront capital investment and have the potential to fulfil Zenith’s mid-cap development objectives.