Oil and gas production company Zenith Energy has signed an agreement to acquire Coro Energy’s natural gas production and exploration (E&P) portfolio in Italy.
Coro’s Italian portfolio includes 100% working interests in four producing concessions namely Sillaro, Rapagnano, Casa Tiberi and Bezzecca, S Alberto.
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It also includes two exploration natural gas concessions, Laura and Santa Maria Goretti.
Zenith Energy CEO Andrea Cattaneo said: “Upon completion of the acquisition, Zenith will have significantly enhanced its Italian operations with a material increase in revenue generation and natural gas production, making it one of the leading natural gas producers in Italy.
“There are a number of opportunities to increase production from current levels in the acquired assets through targeted relatively low-risk well interventions, also present in our existing Italian portfolio. Our newly enhanced technical team and financial resources will enable Zenith to apply renewed focus on its Italian portfolio.”
With the acquisition of Coro Energy’s portfolio, Zenith will be able to increase gross production revenue in Italy by about 410%.
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By GlobalDataZenith will also have a total cumulative production from its Italian portfolio of 55,000 standard cubic metres per day (scm/d).
The initial deal consideration of £402,000 will be paid on completion in Zenith shares, priced at £0.06 each, with a further contingent of up £3.5m payable upon the performance of the acquired assets.
To initiate the extra payment, the acquired assets need to yield production of 100,000ft³/d or 590 barrels oil equivalent per day (boe/d) over four successive months.
With the acquisition, Zenith’s natural gas production activities in Italy are expected to give increased relevance in the context of Italy-Azerbaijan natural gas industry cooperation regarding the immediate activation of the Trans Adriatic Pipeline.
The transaction is conditional upon approval of sale by the Italian Ministry of Economic Development.
It is also subject to final regulatory approval from the TSX Venture Exchange.
