Zenith Energy has scrapped its plans to acquire Norway-based oil and gas company Nordic Petroleum owing to unexpected complications and high costs.
The Canadian oil and gas company, however, will persist with its plans to establish a Norwegian vehicle for participating in future licensing bids to be organised by the Norwegian Ministry of Petroleum and Energy, in addition to actively pursue the possible purchase of mature energy production assets.
Zenith intends to create a Norwegian subsidiary, expected to be named Zenith Energy Norway in the immediate future.
Zenith CEO Andrea Cattaneo said: “The Board views Norway as an ideal environment for the development of junior energy companies such as Zenith on account of its highly specialised investor community and the country’s long history of successful energy production.
“It is regrettable that the proposed acquisition of Nordic could not be completed due to unforeseen complications and the potential incurrence of high costs. We wish Nordic and its shareholders all the best in their future endeavours.
“At the same time, we are pleased to have found a strategically preferable, non-dilutive, alternative avenue for the imminent establishment of our presence in Norway.”
Zenith Energy purchased Coro Energy’s Italian portfolio last week
Recently, Zenith acquired Coro Energy‘s producing assets in Italy for a total consideration of £3.9m.
The initial £0.4 million consideration for the disposal, payable by Zenith to the Group on completion, will be settled through the issue of 6.7 million new Zenith Shares at an effective issue price of 6.0 pence per Zenith Share.
The acquisition is expected to position the company as one of Italy’s leading natural gas producers and operators.
Zenith anticipates to complete the acquisition of further European natural gas production assets in the near future.
The oil and gas production company primarily focuses on the development of its Azerbaijan operations. It operates the largest onshore oilfield in Azerbaijan following the signing of a 25-year Rehabilitation, Exploration, Development and Production Sharing Agreement (REDPSA) with SOCAR in 2016.
