TIDMZEN
RNS Number : 1146S
Zenith Energy Ltd
04 November 2019
November 4, 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")
Proposed acquisition of Norwegian oil & gas company
Zenith Energy Ltd., ("Zenith" or the "Company"), (LSE: ZEN;
TSX.V: ZEE; OSE: ZENA-ME), the international oil & gas
production company, is pleased to announce that it has formalised
an offer to acquire a Norwegian oil & gas company, Nordic
Petroleum AS ("Nordic"), by way of an exchange of equity.
The proposed acquisition is structured to be for a minimum of 90
percent of the outstanding shares in Nordic with a proposed equity
exchange of 100 Nordic common shares for 1 Zenith common share
("Proposed Terms").
The amount of outstanding fully diluted shares in Nordic is
905,045,166 common shares (nine hundred five million forty-five
thousand one hundred sixty-six). Zenith will issue up to 9,050,452
common shares of no par value under the Proposed Terms.
Nordic was founded in Norway in 1996, where its shares are
traded on the Norwegian OTC market, and has around 1,100
shareholders. Its primary activities have been in heavy oils in
Alberta, Canada. In addition, it has significant tax credits in
Norway, as well as an ongoing legal claim against a UK party.
Zenith has agreed to withdraw itself from any positive or negative
obligations in relation to this claim meaning that any potential
benefit or negative liability resulting from the legal claim will
rest solely with Nordic shareholders. Nordic currently generates no
revenue.
The unaudited net value of Nordic's equity presently stands at
NOK 8,800,000 (equivalent to approximately CAD$1,270,000 or
GBP750,000).
Nordic's Board of Directors has decided to recommend the
Proposed Terms to its shareholders for approval provided certain
conditions and practicalities in the Proposed Terms be resolved
prior to the Formal Offer being submitted to shareholders.
Upon completion of the proposed acquisition of Nordic, Zenith
intends to use Nordic as a vehicle to pursue the acquisition of
mature energy production assets, as well as for potential
participation in future licensing bids organised by the Norwegian
Ministry of Petroleum and Energy.
The transaction further cements the Company's Norwegian presence
in anticipation of attracting additional support from long-term
Norwegian institutional investors.
Zenith and Nordic will provide further updates as
appropriate.
Andrea Cattaneo, Chief Executive Officer of Zenith,
commented:
"The Board of Directors views Norway as an ideal environment for
the development of junior energy companies such as Zenith on
account of its highly specialised investor community and the
country's long history of successful energy production.
The primary benefits of the Norwegian subsidiary acquisition
include establishing a presence in Norway which will enable us to
significantly enhance our market exposure and attract further
support from long-term Norwegian institutional investors, as well
as the ability to participate in Norwegian energy projects via our
subsidiary. This is in keeping with our stated strategy of
targeting additional brown field sites as we look to enhance our
portfolio of producing assets.
I look forward to updating investors in due course on
progress."
Per Gunnar Løge, Chairman of Nordic Petroleum AS, commented:
"The offer from Zenith represents an opportunity for our
shareholders. While Nordic has struggled with a position in a
cumbersome heavy oil segment of the industry, Zenith has
established a growing business in conventional petroleum
segments.
Hence, we believe that this transaction will give our
shareholders a more interesting future, and a future with upside
potential. Furthermore, potential rewards from our claims towards a
UK entity in London will be channelled to our present
shareholders."
Further Information:
Zenith Energy Ltd
Andrea Cattaneo, Chief Executive Tel: +1 (587) 315
Officer 9031
-----------------------------
E-mail: info@zenithenergy.ca
-----------------------------
Peterhouse Capital - Joint Broker Tel: + 44 (0) 207
469 0930
-----------------------------
Lucy Williams
-----------------------------
Charles Goodfellow
-----------------------------
Novum Securities Limited - Joint Tel: + 44 (0) 207
Broker 399 9400
-----------------------------
Charlie Brook-Partridge
-----------------------------
Hugh McAlister
-----------------------------
IFC Advisory Limited - Financial Tel: + 44 (0) 203
PR & IR 934 6630
-----------------------------
Graham Herring
-----------------------------
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 9, 2019 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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