Zenith Scraps Norwegian Acquisition
Canadian producer Zenith Energy has dropped plans to buy Norwegian minnow Nordic Petroleum because of “unexpected complications and potentially high costs,” it reported on December 9.
Zenith announced an all-stock takeover of Nordic in November, saying it would use the company as a means of targeting opportunities in Norway’s oil and gas industry. It now plans to instead set up a subsidiary called Zenith Energy Norway for this purpose, it said in a statement. The company’s aim will be to take part in future Norwegian licensing rounds as well as potentially acquire mature energy production assets.
Zenith currently produces oil in Azerbaijan and gas in Italy. It also struck a deal this month to buy assets from London-based Coro Energy, expanding its Italian operations considerably.
According to Zenith CEO Andrea Cattaneo, Norway is an ideal environment for a junior company because of its highly specialised investor community and its long history of oil and gas 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,” Cattaneo commented. “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.”