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Zenith Energy makes onshore acquisition in Tunisia

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Oilfield Technology,

Zenith Energy has signed a conditional sale and purchase agreement with Kufpec (Tunisia), for the acquisition of an working interest in the North Kairouan permit and the Sidi El Kilani concession, which contains the Sidi El Kilani oilfield.

The SLK concession is one of the most productive fields in onshore Tunisia and currently producing at a rate of approximately 700 bpd, generating gross annual revenues of approximately US$15 million.

Zenith expects to soon commission a new Competent Person's Report in compliance with Canadian securities laws in order to obtain an updated reserves evaluation for the Tunisian acquistion.

As announced on 2 March 2020, Zenith is currently in negotiations with an international oil major to sign an offtake agreement for the asset's future oil production in order to fund the Tunisian acquistion and its development post-completion.

Andrea Cattaneo, CEO, commented: “We are delighted to have acquired an interest in the Sidi El-Kilani Concession, a highly productive onshore oil production and development asset, which has consistently outperformed even the most optimistic production forecasts since it was first discovered by KUFPEC in 1990. Upon completion of this deal, Zenith will have material production which is expected to generate significant cash flow for reinvestment in field development activities.

Our strategic outlook is that oil prices will progressively strengthen in line with a gradual worldwide recovery in financial and industrial activity following the progressive alleviation of the devastating Covid-19 pandemic.

Indeed, the current low oil price environment has brought about a singular time of opportunity for companies wishing to expand counter cyclically by securing large, revenue generating oil and gas production assets with highly advantageous acquisition terms.

I am also to delighted to have initiated a fruitful relationship with KUPFEC, a highly respected subsidiary of the Kuwait Petroleum Corporation, and I look forward to exploring further potential cooperation opportunities in the future.” 

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