TIDMZEN
RNS Number : 8295H
Zenith Energy Ltd
05 August 2019
August 5, 2019
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")
Update on Debt Financing
Zenith Energy Ltd., ("Zenith" or the "Company"), (LSE: ZEN;
TSX.V: ZEE), the international oil & gas production company
operating the largest onshore oilfield in Azerbaijan, is pleased to
provide an update on its short and long-term debt position.
-- On January 11, 2019, the Company announced that it had issued
and listed a new EMTN (European Medium-Term Note), on the Third
Market (MTF) of the Vienna Stock Exchange, with an interest rate of
8% per annum payable semi-annually, and a final maturity date of
December 20, 2021. Zenith is pleased to report that, to date, all
interests payable in relation to the aforementioned instrument have
been paid.
-- On March 11, 2019, the Company reported that it had
favourably renegotiated the US$1,500,000 Convertible Loan facility
(the "Convertible Loan") first announced on September 5, 2018, to
include the possibility of optional redemptions to be made by the
Company in lieu of conversion of the Facility by the Lenders, and
had extended the repayment date of the Convertible Loan to May 31,
2020.
The Company can confirm that the outstanding balance of the
Convertible Loan is now US$770,000.
-- On January 7, 2019, the Company announced that it had entered
into a new unsecured convertible loan facility (the "Loan
Facility") with a consortium of lenders.
The Loan Facility has an interest rate of 8% per annum, payable
quarterly, it is repayable on January 15, 2021 and, to date, the
Company has only drawn down GBP544,500 in relation to the Loan
Facility.
-- On March 25, 2019, the Company announced that it had issued
unsecured notes (the "Notes") for a total amount of GBP90k
(CAD$153k) with 900,000 share purchase warrants attached. The
payment date of the Notes is September 20, 2019.
-- In Switzerland, the Company is pleased to report that the
financial debt position of its Swiss registered oil trading
subsidiary, Altasol SA, has been brought to zero.
-- In Azerbaijan, the two trade finance facilities entered into
by the Company's subsidiary have been renewed for a further 12
months, as outlined in the most recent Financial Statements for the
three months ended June 30, 2019, with a favourable reduction of
the interest rate to 9% per annum being in the course of
implementation at present.
-- Zenith has been notified that the guarantor of the facility
of the value of US$1,458,000, Mr Andrea Cattaneo, Chief Executive
Officer of the Company, has been advised towards initiating a
process of litigation as it appears that his guarantee has been
obtained unlawfully. The full amount of the principal, and related
accrued interest, of the loan are represented and accounted as a
liability in the audited Financial Statements of the Company as of
March 31, 2019 and in the Q1 Financial Statements as of June 30,
2019. The result of the potential litigation could be a reduction
or cancellation of this liability.
The Company has adopted a funding strategy directed towards debt
financing in order to minimise equity dilution. To facilitate the
securing of debt financing to support Zenith's expansion, on
October 10, 2018, the Company announced that ARC Ratings, SA. had
assigned the Company a medium to long-term issuer credit rating of
"B+" with Positive Outlook.
Andrea Cattaneo, Chief Executive Officer of Zenith,
commented:
"As is clear, we are taking important steps to progressively
improve the Company's debt position and minimise our reliance on
the issue of equity to finance Zenith's development.
We expect the prospective success of our drilling operations
during the period ahead to enable us to make further significant
improvements to our balance sheet."
Further Information:
Zenith Energy Ltd
Andrea Cattaneo, Chief Executive Tel: +1 (587) 315 9031
Officer
-----------------------------
E-mail: info@zenithenergy.ca
-----------------------------
Peterhouse Capital - Joint Tel: + 44 (0) 207 469
Broker 0930
-----------------------------
Lucy Williams
-----------------------------
Charles Goodfellow
-----------------------------
Novum Securities Limited - Tel: + 44 (0) 207 399
Joint Broker 9400
-----------------------------
Charlie Brook-Partridge
-----------------------------
Hugh McAlister
-----------------------------
IFC Advisory Limited - Financial Tel: + 44 (0) 203 934
PR & IR 6630
-----------------------------
Graham Herring
-----------------------------
Miles Nolan
-----------------------------
Zach Cohen
-----------------------------
Notes to Editors:
Zenith Energy Ltd. is an international oil and gas production
company, listed on the TSX Venture Exchange (TSX.V: ZEE) and London
Stock Exchange (LSE: ZEN). In addition, the Company's common share
capital was admitted to trading on the Merkur Market of the Oslo
Børs (ZENA:ME) on November 8, 2018. The Merkur Market is a
multilateral trading facility owned and operated by the Oslo
Børs.
The Company was assigned a medium to long-term issuer credit
rating of "B+ with Positive Outlook" on October 8, 2018 by Arc
Ratings, S.A.
The Company operates the largest onshore oilfield in Azerbaijan
following the signing of a 25-year REDPSA, (Rehabilitation,
Exploration, Development and Production Sharing Agreement), with
SOCAR, State Oil Company of the Republic of Azerbaijan, in
2016.
The Company's primary focus is the development of its Azerbaijan
operations by leveraging its technical expertise and financial
resources to maximise low-cost oil production via a systematic
field rehabilitation programme intended to achieve significantly
increased revenue. Zenith also operates, or has working interests
in, a number of natural gas production concessions in Italy. The
Company's Italian operations produce natural gas, condensate and
electricity.
Zenith's development strategy is to identify and rapidly seize
value-accretive hydrocarbon production opportunities in the onshore
oil & gas sector. 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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