NEW BENIN ASSET GREAT POTENTIAL


ZENITH ENERGY LTD.

("Zenith" or the "Company")

Offer for Sèmè Field in Benin

Zenith Energy Ltd. (LSE: ZEN; OSE: ZENA) , the energy company with proven revenue generating production, exploration and development assets in Africa and Europe , is delighted to announce that on September 15, 2022 (the last valid day for participation in the offer submission process) it presented an offer (the "Offer") to the relevant Ministry in the Republic of Benin for the award of an initial nine-year licence to operate Block 1 containing the Sèmè oilfield, offshore Benin ("Block-1").

About Block-1

· A proven oilfield, with significant unexploited potential, having estimated recoverable reserves (P2) of 22-28 million barrels of oil and 428 billion cubic feet of natural gas (Kerr McGee 2005).

· Has produced a reported 22 million barrels of oil to date, with last production having taken place in 1998.

· Historical recovery factor of 22%, leaving significant margin for improvement of the recovery factor utilising modern completion techniques, horizontal drilling, and improved 3D seismic.

· Last produced at a rate of approximately 2,000 barrels of oil per day.

· 23 wells have been drilled in Block-1, with the last well having been drilled in 2009 by South Atlantic Petroleum (SAPETRO). This well discovered oil, however, due to the prevailing oil price at the time (approx. US$30) it was deemed uncommercial.

· Located in shallow water (30m) offshore with onshore facilities and tank farm for processing of oil production.

· Discovered in 1967 by Union Oil, Block-1 covers 551 sq. km with over 355 sq. km of recent 3D seismic data.

· Significant development and exploration potential in the emerging Syn-Rift play extending from neighbouring Nigeria.

· Production facilities comprised of three platforms, the last being installed in 2014-2015.



Andrea Cattaneo, Chief Executive of Zenith, commented:

"We are delighted to have submitted this Offer for what is an extremely exciting opportunity in Benin, representing the largest and most prospective oilfield in the country.

"Block-1 has significant untapped, independently assessed oil and gas reserves, a proven history of material oil production and existing field infrastructure. These key qualities make it a potentially highly enriching addition to our portfolio and fully satisfy the key criteria defining our growth strategy.

"Benin is a stable and attractive jurisdiction for foreign investment, and we look forward with great enthusiasm to working closely with the local authorities to ensure we achieve a fruitful and enduring partnership in the event our Offer is accepted ."



Details of the Offer and Next Steps

The Company has presented an offer that outlines certain investment commitments and terms to be negotiated as part of an award for an initial nine-year licence.

The Offer contains specific details surrounding how the Company will restore and expand the productivity of Block-1. Specific geological attention will be directed towards developing the emerging Cretaceous Play along the West African coast, which has proven to be a highly prolific basin extending from Côte d'Ivoire, Ghana to the West, to the east in Nigeria, with the large 'Ogo' oil and gas discovery, as well as producing in the Aje Field.

If Zenith's Offer for Block-1 is accepted, Zenith will progress in completing a rigorous due diligence process and begin negotiations with the Ministry aimed at finalising a draft Production Sharing Agreement to be approved by the legislature of Benin (in accordance with the Hydrocarbon Code).



Operationally, following potential acceptance of the Offer, the Company will seek to use the existing infrastructure installed in 2015, where previous development was stalled due to the low oil price environment at the time, to rapidly restore commercial production in the current high oil price climate for the benefit of the citizens of the Republic of Benin and Zenith Energy shareholders.

As part of the Offer, the Company has also presented a comprehensive social development plan, outlining agricultural community engagement initiatives aimed at fostering productivity and local employment, in addition to a sustainable development plan that takes into consideration the natural history of the region and places environmental sustainability at the heart of the Company's business development activities in Benin.

About Benin's Oil Industry

In recent years, there has been an attempt to revive domestic oil production in Benin following the previous involvement of various Western oil companies between 1984-1998, including the Norwegian Saga Petroleum.

In late 2019, CNPC signed a construction and operation agreement with the Government of Benin for the construction of the Niger-Benin Crude Pipeline, a 1,980km cross-border crude pipeline connecting the Agadem Rift Basin (ARB) region in Niger to Port Seme Terminal in the Republic of Benin. Construction of the pipeline is underway and is expected to be completed by the close of 2023.

Benin is a founding Member of the African Petroleum Producers' Organization ("APPO"), and its Minister in charge of Hydrocarbons serves as Vice-President of the APPO.



-ENDS-

“ produced a reported 22 million barrels of oil to date, with last production having taken place in 1998 “ wow!

«…begin negotiations with the Ministry aimed at finalising a draft Production Sharing Agreement to be approved by the legislature of Benin..»

Vi har nå snart 40 fugler på taket! :))))))

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Hva er prisen?

Benin er i hvert fall et stabilt land i Afrika. I motsetning til Nigeria.
———————————

Er dette derfor IC ble utsatt 2 ganger??
Redigert 22.09.2022 kl 10:25 Du må logge inn for å svare
Viking_I
22.09.2022 kl 10:25 4816

Look like done deal -
Recoverable reserves (P2) of 22-28 million barrels of oil and 428 billion cubic feet of natural gas (70million Barrels Of Oil Equivalent)
- Current 2P reserve is 28 million including Tilapia .
- Proven oil field.
- 2000 bopd will give Kr 54 million per month (NOk 648 million/ year)
- Including Tilapia and Tunisia it will cross company income Nok 1.4 billion per year total.
- Total valuation will be - around kr 2.09 with $10 million investment. ( Gas and possible electricity generation not included )
Redigert 22.09.2022 kl 10:31 Du må logge inn for å svare

Another great deal by AC, imagine if we get Tilapia on top of this as well as ramp in production in Tunisia, the money owed as well as increase in electricity sales. We are way undervalued at current prices I am expecting a huge rerating.
Viking_I
22.09.2022 kl 10:35 4747

my calculations based on 2P gives kr 2.09 with Tilapia, 20 times higher form current price (Conservatively will go higher 20% to 30% with amount of gas and current price)

One good institutional investor and price will go to bazooka now.
Redigert 22.09.2022 kl 10:38 Du må logge inn for å svare

Based on previous statements from AC, zena is seeking deals that may be closed quickly. Let's hope that this is the case with Sèmè Field. For me one of the most important information given in the RNS is; "Benin is a stable and attractive jurisdiction for foreign investment". Based on the history in Congo Brazzaville, this sentence implies that AC is confident about this opportunity.
Redigert 22.09.2022 kl 10:39 Du må logge inn for å svare
Mdg1
22.09.2022 kl 10:51 4638

Jeg har hørt en klok dame si. "Ikke selg skinnet før bjørnen er skutt"

Lad os håbe der snart kan komme noget håndfast så vi kan komme igang med noget seriøst istedet for at vende femører hvergang feks strømprisen i IT kommer ud🙄🙄🙄, sammen med gårdsdages kredit opgradering lysner det synes jeg.

Hehe, tror ikke hun hadde planer om å selge skinnet på børsen.. på børsen kan aksjen stige i verdi når fellingsløyve på bjørnen er utstedt, og potensiale for å selge skinnet en gang i fremtiden er til stede

Apparently 42 million barrels of oil in place!
C-Eiken
22.09.2022 kl 14:10 4349

Nuværende ejer:
https://www.sapetro.com/about-us/
"we have a 100% operating interest in the Sèmè oilfield, offshore the Republic of Benin. Sèmè field is a brownfield and has a long and proven production history stretching back 30 years. Redevelopment drilling works carried out in Sèmè in 2014 and 2015 encountered some technical challenges which coupled with more than 50% decline in oil prices led to suspension of the project. SAPETRO is currently re-evaluating its options in Benin."
C-Eiken
22.09.2022 kl 14:42 4287

https://www.yumpu.com/en/document/read/65294124/offshore-africa-magazine-vol-11-issue-1-february-2021-edition - Page 32
Benin Readies to Sell Seme.
Seme oildfield, block 1, operated until 2015, but falling oil prices and technical glitches forced it to abort its plans to get production back up and running. The fields is understood to still contain 20m barrels or recoverable oil. A dozen oil firms have already contacted the ministry to offer their service for Seme. If none of those accept the exploration terms stipulated in the new legislation, Benin may decide to embark on promotional campaign.
Viking_I
22.09.2022 kl 15:51 4401

Is delighted to announce that on September 15, 2022 (the last valid day for participation in the offer submission process).
Must be received positive response in a week so Zenith Announced it will come to know time line in IC.
Redigert 22.09.2022 kl 15:54 Du må logge inn for å svare
Gullit
22.09.2022 kl 22:56 4172

Kan det komme svar allerede neste uke?
Tetro
23.09.2022 kl 07:41 3927

Det er merkelig stille fra de såkalte seriøse investorene i Zenith. Hvor er aqualight, svartsyn og lato f.eks????
Mdg1
23.09.2022 kl 07:47 3901

De har lagt inn bud. De har ikke fått tilslaget enda, så tenker det er tid for å roe ned og se hva som skjer videre
Hektor
23.09.2022 kl 07:55 3868

Er innom i ny og ned Aqualight og Svartsyn, men de er nok litt oppgitt over at det er VM å skrive mest mulig her på forumet om daytrading på ZENA ticker. Fint med litt debatt, men det er måte på for en oljemygg. LATO user er slettet.

Utsettelsen av IC grunnet "potential near-term progress" kan jo ikke sammenlignes med å levere inn et anbud på et åpent tilbud. Så jeg er enig med deg Mdg1 at her er det bare å roe ned.
Var utsettelsen bare en forlengelse av ferien, eller kan AC faktisk levere noe??
Mdg1
23.09.2022 kl 08:08 3819

Utsettelsen var nok for å svare på spørsmål angående lisensen de har lagt inn bud på. Det er uansett ikke slik at det kommer til å sprute olje fra det feltet på kort sikt.
C-Eiken
23.09.2022 kl 08:17 3788

Nej det kræver nok en større work-over for at komme op og køre igen - mange penge der skal hædes i det huld inden olien flyder

Nu er der ingen grund for at at have en holdning til at firmaet har afgivet et bud. Hvis det er lig med underligt stille, så er det bare sådan det er.

Men god dag til jer “normalt” larmende.

Aqualight 🇩🇰🇳🇴

God luring denne høytsvevende Italieneren 🤣
Svartsyn
23.09.2022 kl 11:20 3347

Spot on ,Hektor.
Det skrives så mye svada av noen at det er utrolig.
For å forenkle det hele,bra hvis vi får dratt dette i land.
Det har dog stått så lenge I ro ,at det vil bli både oppstartskostnader som er vesentlige og det vil ta tid.
Men det vil være et nytt steg mot å bli noe større.
Steg for steg er en filosofi jeg liker.
Den dagen vi kommer opp på 1000 fat i egenproduksjon for Zenith så bør dette gå på skinner.
Det har aldri sett bedre ut..
God helg til alle Zenithere.
Hilsen en gammel oljeborer som reiser fra sykehuset etter min andre hjerteoperasjon.
Aksjer er ikke alt.
Men dette trur jeg ender godt....
Daglig vrøvl hjelper ikke ( ironi)
C-Eiken
23.09.2022 kl 11:41 3275

Konjagi skrev Innlegget er slettet
Det er en artikel fra 2016, just FYI så intet med den nuværende bud at gøre

None of these applicants are Nigerian companies and the Ministry of Mines & Energy will shortly announce the winning award, sources said.

“We’re just waiting for the newly-elected government to outline policy and decide how to press ahead with fresh licensing, including the deep,” a senior official at the Ministry’s Office of Hydrocarbons (OBH) told Upstream. First produced by Norway’s Saga Petroleum in the 1980s, Seme was the subject of sustained ­efforts by Sapetro to redevelop, but the independent’s finances were hit hard by last year’s collapse in the oil price.

However, Benin is seeing its near-shore and deeper water blocks attracting increasing interest by regional and global mid-tier players after recent Benin Embayment discoveries across the Nigerian border have begun to bear fruit.

First shipments from Panoro’s Aje field are expected before the end of the month, while Nigerian-owned Lekoil hopes to develop its Ogo disovery on OPL-310. Off Benin, another Nigerian operator Oranto Petroleum is seeking a partner before drilling across blocks 5 and 6, while fellow Nigerian explorer FrazOil is interpreting 650 square kilometres of recently-acquired 3D seismic, although drilling is unlikely before 2018.

CBH, a subsidiary of locally incorporated Lusitania Petroleum, has held on alone to Block 4, in which Brazil’s Petrobras once took interest.

Onshore, no activity is anticipated on blocks B and A, still operated by UK-based Elephant Oil and Nova Scotia’s NS Oil respectively, both of which plan fresh 2D seismic.

OBH director Jean-Jacques Atchade told Upstream he has advised newly-appointed Energy Minister Dona Jean-Claude Houssou to press ahead in licensing vacant acreage.

Atchade officially retired last month but continues to work at OBH while the government decides on his replacement.

Along with a fellow exploration department retiree, Atchade will this month register his own upstream consultancy focusing on Benin and the sub-region.
Redigert 23.09.2022 kl 11:55 Du må logge inn for å svare

Benin virker til og være seriøse og fremoverlente i olje de siste år, forhåpentligvis hvis zenith vinner budet så vil det tilrettelegges for hurtig fremgang i oljefeltet uten politisk administrativt sirup slik vi har sett andre steder.

https://allafrica.com/stories/202107190128.html

pelo
23.09.2022 kl 11:49 3235

Konjagi skrev Innlegget er slettet
Hhmm Konjagi - har du lige taget dig besværet at checke datoen på denne artikel ? (august 2016 !)
Hektor
23.09.2022 kl 12:11 3160

God helg Tetro 👍til Lykke Svartsyn og nyt helgen!
Konjagi
23.09.2022 kl 12:22 3127

Hehe...beklager, men overså noe vesentlig. Blir helt blendet av all info :-). Innlegget er slettet
BMU
23.09.2022 kl 12:50 3042

I m sure that hi well get Tilapia in time its law of attraction here playing a part, when you get one it attract another beach which we haw ben waiting for so lang.
I m locoing forward to AC next book ,,Haw to build an empire" and I hope he can have one chapter about what investors think and says (not all of Tham).If he will have comic section a guess I will be in it with my posts but they haw to be polished ,,little bit" so it takes time (more than Tilapia). 😂😂😂
Redigert 23.09.2022 kl 12:54 Du må logge inn for å svare

The acquisition of this new oil field is great news, assuming that it all goes ahead as stated.

The positives from my point of view are very clear:
a) Benin seems like they are very serious at a government level about improving their oil and gas industry which indicates that carrying out business there will be less bureaucratic than in either the Congo or Tunisia.

b) The license area that is in the process of being acquired is a production asset rather than an exploration asset, has reserves of 22 million barrels of oil and 428 billion cubic feet of natural gas. It last produced at a rate of 2,000 bopd. The reason that the field was abandoned in the past was due to the oil price dropping to $30 and leaving the field uncommercial. With the current oil price at £87 this is no longer a problem.

c) The acquisition of this field would double the company’s P2 reserves (including Tilapia) and if the company’s net share of production was 1,000 bopd then it would also treble our current production.

d) Because of the existing production in Tunisa and Italy, the company is generating approximately $17 million per annum net which is easily enough to service a debt facility that would enable Zenith to bring the field back into production without having to dilute shareholders by issuing new equity.

e) The acquisition of another license in another jurisdiction spreads the risk of events in a single country (Tunisia/Congo) impacting on Zenith’s production potential.

f) Zenith shareholders have been waiting for what seems like forever to get approval for Tilapia 2. Now we have another asset of equal potential that the company can begin work on while we wait for the T2 license to be granted. It gives a much greater near-term upside as long as it is acquired quickly as we will no longer be held hostage by a single bureaucracy in a single country.

To me this seems, like an excellent deal. It ticks the boxes for many things that I have been advocating on these boards for some time – spreading risk, giving another “crown jewel” asset, significantly increasing the company’s near-term production potential and giving another big reason for the market to re-rate the company.

There are a few questions that still need to be answered about the asset before we can decide exactly how good a deal this might be, and I will be bringing these up (added to my long list of questions) at the next investor conference call.

1) What is the timescale in which the offer may/may not be accepted?
2) What is the cost of the acquisition and how will it be funded? (hopefully out of existing cash-flow if possible or otherwise debt)
3) What is the timescale in which the fields could be brought into production once the field is acquired and what would be the cost of this? Would it be funded by debt?

Subject to these questions being answered satisfactorily then I think that we could lack on this acquisition as a major company defining moment for Zenith.
Aldara
23.09.2022 kl 15:15 2815

Ganske skuffende(som vanlig!) at det ikke kom noe mer håndfast enn dette! Nok løse fugler fra før:-D
RKW
23.09.2022 kl 18:09 2642

løse fugler eller hodeløse høns! hva er viktig for zenith, nye reserver i bakken, eller boring for å få olje opp av de feltene de allerede har?

viktigste er at de kommer med noe gode meldinger som viser at det er like før at de får olje fra bakken og at vi alle som sitter har inn tror at det er like før at det smeller😜 bare tuller selvsagt begge tingene er like viktig, men selvsagt for dem sans for noe som lukter raske penger så hopper dem der