Zenith Energy, the listed international energy production and development company, has announced the full completion of an acquisition in Italy, as well as providing an update on its Italian energy production portfolio.
Acquisition of additional stake in Sant'Andrea natural gas production concession
The Company has acquired, and received the necessary final regulatory approvals, for the acquisition of an additional 10% interest in Sant'Andrea from Petrorep Italiana.
Following completion of the Acquisition, Zenith's 40% interest in Sant'Andrea has increased to 50%.
As previously announced, the Company plans to reactivate the S. Antonio-1 well located in Sant'Andrea, with an expected initial production rate of approx. 1,500 cubic metres of natural gas per day.
Under the terms of the acquisition, Petrorep has paid Zenith's Italian subsidiary the amount of EUR 248,000 (approx. GBP 212,000 or NOK 2,850,000) to cover its share of future plugging and abandonment costs calculated pro rata based on its participation in Sant'Andrea.
The Company is confident that production from Sant'Andrea will commence in October 2024.
Zenith's partners in Sant'Andrea have communicated that they do not intend to fund the costs associated with its reactivation. Zenith will therefore receive full entitlement to the production revenue to be received from Sant'Andrea, as well as bearing the full costs associated with the reactivation of production, estimated in the amount of EUR 20,000.
Italian Electricity Production - Torrente Cigno Concession
The Company continues to generate electricity at the Torrente Cigno with an average monthly production of approx. 950 megawatt hours ('MWh').
Electricity prices averaged approx. EUR 96 per MWh during January 2024 and averaged approx. EUR 84 during the month of February 2024, resulting in cumulative net revenues of approx. EUR 171,000 for the period.
Zenith's current net production costs remain fixed at approx. EUR 35,000 per month.
Andrea Cattaneo, Chief Executive Officer, commented:
'We are pleased to have increased our participation in Sant'Andrea which we hope to bring to production later this year, creating an additional revenue stream for the Company.
'I am pleased to report that the Company is currently evaluating a potentially significant additional acquisition in Italy, and I look forward to providing updates in due course if negotiations prove successful.'
Source: Zenith Energy
