Canadian oil and gas production company Zenith Energy has agreed to acquire an operated working interest (WI) in an oil production asset onshore Tunisia.
Currently, the asset produces 700 barrels of oil per day (bopd) and generates annual gross revenue of about $15m.
Due diligence activities have already begun and Zenith Energy expects these to complete by the end of this month.
The company has also initiated talks with an undisclosed oil firm to sign an offtake agreement for the asset’s future production. This will help finance the acquisition.
Zenith Energy CEO Andrea Cattaneo said: “It is Zenith’s strategy to acquire revenue-generating oil and gas production assets. The acquisition represents an attractive opportunity to enrich our asset portfolio in a country where management has significant experience.
“We are currently performing due diligence and visiting the target asset with a view to completing the acquisition by 31 March 2020.
“It is important to underline that we have no plans to issue equity to fund the acquisition or its immediate development following completion.”
According to Zenith Energy, Tunisia has a national production capacity of approximately 35,000bopd. The country’s geographic features attract junior independent exploration and production (E&P) companies.
In December, Zenith Energy signed an agreement to acquire Coro Energy’s natural gas production and exploration portfolio in Italy.
In July, the company started well-deepening operations in well C-37 at its onshore oilfield in Azerbaijan.