REG - Zenith Energy Ltd - Update on Electricity Production & Financing

Zenith Energy (CA)Announcement

10/05/2022 11:00

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RNS Number : 9405K  Zenith Energy Ltd  10 May 2022

May 10, 2022

ZENITH ENERGY LTD.

("Zenith" or the "Company")

Update on Electricity Production & Financing

Zenith Energy Ltd. ("Zenith" or the "Company") (LSE: ZEN; OSE: ZENA), the
listed international energy production and development company, is pleased to
provide an update on its electricity production operations at the Torrente
Cigno concession in Italy during the month of April 2022.

 

During the month of April 2022, the Company produced a total of approximately
974.4 MWh.

Electricity prices during the month of April 2022 averaged approximately EUR
236 per MWh, resulting in net revenues of approximately EUR 230,000. Zenith's
current net production costs remain fixed at approximately EUR 35,000 per
month.

Non-convertible Loan Agreement for EUR 1.3 million

 

The Company has entered into a non-convertible loan agreement (the "Loan")
with a financial institution for a total amount of EUR 1.3 million (equivalent
to approximately 13.1 million NOK or £1,111,800).

 

The Loan has a duration of ten months, attracts an interest of 5% per annum
and includes normal warranties and default clauses.

 

In connection with the Loan Agreement, the Company has issued the following
share purchase warrants (the "Warrants"):

 

·    85 million Warrants to acquire one common share for each Warrant at
an exercise price of NOK 0.20 (equivalent to approximately £0.017).

·    85 million Warrants to acquire one common share for each Warrant at
an exercise price of NOK 0.25 (equivalent to approximately £0.021).

 

The Warrants have a duration of ten months from the date of issue.

 

Use of proceeds from Loan

The Company plans to use the funds received in connection with the Loan to
provide additional financial support for the achievement of its business
development objectives in the Republic of the Congo, as well as for general
working capital purposes.

 

 

Sale of A-100 Workover Rig

The Company has agreed to dispose of the A-100 workover rig (the "Rig") that
it had previously acquired in Azerbaijan during 2018 by way of its fully owned
subsidiary, Zena Drilling Limited.

The expected lack of spare parts and technical support for the Rig, a rig type
widely used in the oil industry of the Russian Federation and post-Soviet
Republics, as well as the estimated high transportation costs of the Rig from
Azerbaijan to the Company's oil and gas portfolio in Africa, were the reasons
for the sale.

Zenith confirms that it has not recorded a loss, on an amortised basis, in
respect of the consideration originally paid to the manufacturer in 2018 for
the purchase of the Rig.

Further Information:

 Zenith Energy Ltd

 Andrea Cattaneo, Chief Executive Officer    Tel: +1 (587) 315 1279

                                             E:    info@zenithenergy.ca (mailto:info@zenithenergy.ca)
 Alternative Resource Capital - Broker

 Alex Wood                                   Tel: +44 (0) 207 186 9004

 Keith Dowsing                               Tel: + 44 (0) 207 186 9005

 

Market Abuse Regulation (MAR) Disclosure

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 as it forms part of UK domestic law by virtue of
the European Union (Withdrawal) Act 2018 ("MAR"). Upon the publication of
this announcement via a Regulatory Information Service ("RIS"), this inside
information is now considered to be in the public domain.

Notes to
Editors:

Zenith Energy Ltd. is an international oil and gas production company, listed
on the London Stock Exchange Main Market (LSE:ZEN) and the Euronext Growth
Market of the Oslo Stock Exchange (OSE:ZENA).

Zenith's development strategy is to identify and rapidly complete
value-accretive hydrocarbon production opportunities in the oil & gas
sector, specifically in Africa.

Follow us on
LinkedIn:  https://www.linkedin.com/company/zenith-energy-limited/
(https://www.linkedin.com/company/zenith-energy-limited/)

 

 

 

 

 

 

 

 

 

 

 

 

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