Zenith Energy signs agreement to buy Ecumed Petroleum Zarzis

Oil and gas production company Zenith Energy has signed an agreement to take over Ecumed Petroleum Zarzis (EPZ), a wholly-owned unit of Candax Energy.

The deal will be executed through Zenith Energy Africa, a subsidiary of Zenith Energy.

As per the share purchase agreement, Zenith Energy Africa will acquire a 100% stake in EPZ that holds a 45% interest in the Ezzaouia Concession oilfield asset in Tunisia.

Under the agreement, Zenith will pay $150,000 upon completion of the transaction, as well as issue a further $100,000 of its shares within 60 days of completion.

It will also pay royalties of $0.35 per barrel of hydrocarbons produced from the Ezzaouia oilfield, with the royalty not being below $50,000 per year for a ten-year period to EPZ.

Situated in onshore Tunisia on the Zarzis peninsula, south of the island of Djerba in the southern Gulf of Gabes, the Ezzaouia Concession is operated by MARETAP, which is owned by Candax Energy and Tunisian national oil company Entreprise Tunisienne d’Activités Pétrolières (ETAP).

Zenith CEO Andrea Cattaneo said: “Ezzaouia has significant unexploited potential which we intend to develop progressively via a combination of workover and drilling activities.

“By way of this acquisition, we have further reinforced our settlement in Tunisia, enabling a demonstration of our technical and financial capabilities locally.

“The board strongly believes in Zenith’s future successful establishment in Tunisia and we intend to capitalise on certain additional acquisition opportunities that may present themselves in the near-term.”

Zenith said that the acquisition has development obligations including the drilling of a side-track, the drilling of a replacement well and a development well, during the 20-year concession period.

According to the company, the field’s production can be increased to 1,000bopd by implementing the production optimisation and workover activities.