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And this snippet from ZEN's February 2022 Investor Presentation is interesting:-

"The Company’s Italian ‘Gas to Power’ activities are intended to be replicated in certain Africa jurisdictions on a larger scale, specifically in the Republic of the Congo, where there is an abundance of unexploited natural gas reserves and a strong demand for stable electricity production."

https://wp-zenith-2020.s3.eu-west-2.amazonaws.com/media/2022/02/ZENITH-FEb-22.pdf

https://www.zenithenergy.ca/investors/investment-case/

If ZEN can successfully replicate its Italian energy business model on a widespread scale in Africa, then the sky could be the limit.

Though having said that, it probably is anyway.

Also from ZEN's February 2022 Investor Presentation:-

"NATURAL GAS 2P RESERVES:
16.3 BCF"

https://wp-zenith-2020.s3.eu-west-2.amazonaws.com/media/2022/02/ZENITH-FEb-22.pdf

https://www.zenithenergy.ca/investors/investment-case/

ZEN's Italian natural gas sales last year (to 31.3.22): 131,556,000 cubic feet.

I.e. just 0.807% of its total proven & probable Italian natural gas reserves.

It would be interesting to know what the maximum annual output could be, as even if it was increased three-fold, current reserves would still last for over forty years.

And a threefold production increase, at the recent gas price of 321 euros per megawatt hour, could give annual revenues of about EUR 40M.
And a very high profit margins, e.g. c. 90%+.

Add in the Italian electricity revenues, and ZEN's annual Italian energy profit alone could potentially be multiples of its current market cap.

No wonder ZEN is looking to increase production.

15th Sep 2022 7:00 am RNS Trading Update

MYCELX Technologies Corporation ("MYCELX" or the "Company"), the clean water and clean air technology company, today provides a trading update on the Company's business operations.

MYCELX is currently in the commercial phase of contract negotiations with a major oil producer based in the Middle East which, if successful, would see the Company announce its second EOR installation deploying the patented MYCELX REGEN product. Recent negotiations have made us aware it is unlikely the Company will be able to recognize the anticipated revenue for this project in 2022 and, therefore, will defer the revenue to 2023. However, the Company has other sales opportunities in the pipeline that could close before year end that could have the potential to reduce the impact of the delayed revenue. In light of this new information, the Company is revising its guidance and now expects 10% year-on-year revenue growth for FY2022 and anticipated profitability will also be adversely affected.

Connie Mixon, CEO of MYCELX, said:

"While it is disappointing that anticipated project revenue has been deferred to 2023, as a business we continue to have high level interaction with key customers and strategic relationships and operationally we are delivering what our customers require. Historically, bidding activity has increased during the second half of the year, and we stand poised to capitalize on the market opportunities we see in front of us across the application ranges we are targeting. We will provide a full business update when we publish our results for the first half of 2022 in two weeks."

https://www.lse.co.uk/rns/MYX/trading-update-0cw8kxo0djhve5y.html

From ZEN's February 2022 Investor Presentation:-

"OWNERSHIP OF DRILLING EQUIPMENT

Zenith strongly believes in the benefits of owning
and operating the key equipment required to develop
its asset portfolio. For the following reasons:

1. Cost control
2. Operational independence
3. Direct oversight on execution

1
WORKOVER RIG
(375HP)

1
DRILLING RIG
(1,200HP)
capable of drilling to
a depth of approx 5,000 metres
(depending on well design)"

https://wp-zenith-2020.s3.eu-west-2.amazonaws.com/media/2022/02/ZENITH-FEb-22.pdf

https://www.zenithenergy.ca/investors/investment-case/

During the year ended 31.3.22, ZEN had an average of 37 full time employees (see the company's new annual report).

This is an indication of what a substantial, revenue-generating operation this company is.

And of how it likes to do things 'in house', cutting out the middle man, and saving money.

Which is looking a very shrewd move with the upturn in the O&G industry, with other companies struggling to buy in the operational personnel and equipment, and having to 'pay through the nose'.

The Republic of the Congo no doubt appreciated this in selecting ZEN as the successful bidder for Tilapia II, and should do the same in issuing ZEN the licence.

Developing the Tilapia field is an obvious priority for the country: the field looks to be the country's only O&G permit area that straddles onshore & offshore, and all the necessary ancillary infrastructure already appears to be in place:-

"In close proximity to oil storage /processing infrastructure located in the nearby town of Pointe-Noire."
https://www.zenithenergy.ca/operations/republic-of-the-congo/

The sooner they issue the licence, then the sooner ZEN can start pumping oil from it, and making money for the country.

Some other O&G companies are almost like shell companies, with just a few employees (mainly directors), and having to buy in O&G operational services they need.

ZEN in contrast is the real thing.

Thanks Raincat - always nice to hear some enthusiasm for a good investment.

The large majority of shares are negatively correlated to soaring gas and electricity prices, which makes ZEN's positive correlation even more relatively valuable, due to its scarcity factor.

2nd Sep 2022 11:10 am RNS New record Italian Electricity production revenue
" ... During the month of August 2022, the Company produced a total of approximately 985.6 megawatt hours ("MWh").
Electricity prices during the month of August 2022 averaged approximately EUR 538 per MWh, resulting in net revenues of approximately EUR 530,000. Zenith's current net production costs remain fixed at approximately EUR 35,000 per month. ..."
https://www.lse.co.uk/rns/ZEN/new-record-italian-electricity-production-revenue-4gy3i731ezwzmsw.html

Thanks Callit.

ZEN's August 2022 Italian electricity production level of 985.6 mWh, at the projected 2024 electricity price of EUR 1,640.16 per mWh and with production costs unchanged, would equate to EUR 1,616,541.7 of monthly net revenues, and
1,581,541.7 of monthly profit.

Which equates to c. EUR 18.978M. of annualised profit p.a.

And this doesn't allow for any increase in ZEN's Italian electricity production.

Plus ZEN's Italian gas revenues, which based on its production last year & at recent gas prices, could equate to EUR 13.15M of revenue, also at very high profit margins.

And similarly, this doesn't allow for any increase in ZEN's Italian gas production, or increase in Italian gas prices from recent levels.

"Now, I am trying to prove myself entirely wrong here and secretly hope that Congo license is granted and a partner with deep pockets is taken on to re-drill the current AAOG fc*k up. "

Ezhik,

What makes you think that ZEN would need a partner for the drill?

It's very significant that the Tilapia licence area straddles onshore & offshore, as in this case this means that it can be drilled from onshore, which obviously has huge cost savings compared to offshore drilling.

To illustrate the onshore/offshore difference: an onshore drill can cost as little as US$100,000; whereas a deepwater drill can cost US$100 million - i.e. up to a thousand times as much.

Bearing in mind that ZEN has its own staff and equipment, and substantial cash resources, I don't see why they can't do it themselves.

Which would mean that they should be able to get stuck straight into it.

"The Saouaf licence area includes pipelines such as the large diameter Transmed pipeline, with gas compression stations and significant spare capacity. This provides reliable access to the local gas market and commercialisation."

http://uplandres.com/assets/saouaf-northern-tunisia/

Thanks for the share buy-back suggestion Raincat.

With the company generating so much cash it might be seen as an attractive option with its s.p. still quite low, though the company may have better uses for it.

But maybe a possible question for the conference call on 28th. September?

If you look at long-term share price charts, you will see that big strategic moves up and down tend to take place over quite some times.

That's why a good general principle is to run your profits, and cut your losses.

ZEN is really delivering on the business front, and its share price has moved up well over the last couple of months, in bad markets, in response to that.

This is a gradual process though, and that's entirely natural and healthy.

Ezhik,

There's nothing remotely 'fishy' about the Tilapia licence that I can see ... unless you count the fact that it is partly over the sea!

The Republic of the Congo joined OPEC in 2018, which is a sign of the country's growing stature as an important O&G producer.
And if you read through all the relevant RNSes, it's very clear that the authorities in the Republic of the Congo are keen to go with ZEN to develop Tilapia II.

Thanks to Florida for this observation about the usual time for licence approval in Africa apparently being 9 - 18 months:-

Florida Posts: 1,055 Price: 0.85 Strong Buy
Zen 1 Jun '22
"We should be thinking about why AC bought 39m shares on the 31st January 2022. We know Tilapia couldn't happen for 30 day's after the purchase because that would have been seen as insider trading. So, he obviously bought them because he knew it was going to happen later in the year. Covid stagnated the approval proses for well over a year. Add this to the standard time usual for Licence approval in Africa - 9 to 18 months, and we find ourselves right in the middle of the optimum period for this to happen. ..."
https://www.lse.co.uk/ShareChat.asp?ShareTicker=ZEN&share=Zenith-Energy&page=24

Well, we passed the 18 month threshold from ZEN's successful bid for Tilapia II about two and a half months ago:-

23rd Dec 2020 7:00 am RNS Successful bid for Tilapia II
"Zenith Energy Ltd. ("Zenith" or the "Company") (LSE: ZEN; OSE: ZENA-ME), the listed international oil & gas production company focused on pursuing African development opportunities, is delighted to announce that it has received official confirmation from the Ministry of Hydrocarbons of the Republic of the Congo that its local subsidiary, Zenith Energy Congo SA ("Zenith Congo"), has been selected as the successful bidder for the award of a new 25-year licence to operate the Tilapia oilfield ("Tilapia II").
As announced to the market on July 20, 2020, the Company had previously submitted a comprehensive commercial and technical offer (the "Offer") for the award of Tilapia II. ..."
https://www.lse.co.uk/rns/ZEN/successful-bid-for-tilapia-ii-lz7ofr8ipunko20.html

Even adding a bit for COVID-19 delays, it looks like sufficient time has now elapsed for the licence to be awarded at any point.

And as regards ZEN's speed of action, it looks to me to be very impressive for the resources sector. E.g.:-
• Picking up valuable distressed assets for a song at the bottom of the market in 2020, when others were dithering.
• Increasing their Italian gas production last year more than ten-fold.
• 13.7.22 RNS that they would reactivate the the Sant'Andrea concession: production expected to commence in Q4 2022.

ZEN can bring projects on-stream faster than most, because it has its own in-house equipment and staff, which also saves costs:-
https://www.zenithenergy.ca/about/strategy/

The 29 ZEN RNSs already this year shows how much is happening here, and how quickly the co

9th Sep 2019 7:00 am RNS Update on appointment of new Finance Director
"Newmark Security plc (AIM: NWT) is pleased to announce that it will be appointing Graham Feltham as Group Finance Director and Company Secretary. ...
Graham spent approximately five years at StatPro Group plc, an AIM listed Software development group, as European Financial Controller and Group Financial Controller, where he managed the external financial reporting and performance and analysis teams. Following StatPro, Graham spent over four years as Group Financial Controller of Safetykleen Group, a private equity owned group specialising in a recurring book of business in surface cleaners and with annual revenues of over GBP235 million. Graham played a key role in the sale of Safetykleen by Warbug Pincus to APAX Partners for GBP800 million in 2017. ..."
https://www.lse.co.uk/rns/NWT/update-on-appointment-of-new-finance-director-4z1qxp6eolb6j8a.html

Graham Feltham, who was recently NWT's Group Finance Director for nearly two years, previously spent five years in senior roles at AIM-listed StatPro (SOG).

And interestingly, SOG was taken over three years ago by a US predator, at a huge premium:-

"Confluence Acquires StatPro, Global Portfolio Analytics Solution and Data Provider

Acquisition provides global expansion opportunity, broader range of solutions and advancement of Unity® Performance into the cloud

October 29, 2019 06:33 ET | Source: Confluence

... Confluence has acquired the entire issued and to be issued ordinary share capital of StatPro in an all-cash offer of approximately £161.1 million (over $207 million USD). The transaction brings together two highly complementary businesses to create a leading supplier of front, middle and back-office solutions to asset managers and administrators. ..."

https://www.globenewswire.com/news-release/2019/10/29/1936857/0/en/Confluence-Acquires-StatPro-Global-Portfolio-Analytics-Solution-and-Data-Provider.html

The acquisition price of £161.1M. was 5.7 x SOG's most recent half year revenues:-

"Interim results RNS Number : 2777H StatPro Group PLC 31 July 2019
... StatPro Group plc, (AIM: SOG, "StatPro", "the Group"), a leading provider of portfolio analysis and asset pricing services for the global asset management industry, has published its interim results for the six months ended 30 June 2019.
... Group revenue up 3.7% to £28.25 million (2018: £27.24 million) ..."

https://www.investegate.co.uk/statpro-group-plc--sog-/rns/interim-results/201907310700122777H/

NWT's final results, for their year ending 30.4.22, should be announced very soon, based on the timescale of the last few years.

Perhaps even this coming week.

10/09/2021 07:00 UK Regulatory (RNS & others) Newmark Security PLC Final Results LSE:NWT Newmark Security Plc

09/09/2020 07:00 UK Regulatory (RNS & others) Newmark Security PLC Final Results LSE:NWT Newmark Security Plc

19/09/2019 07:00 UK Regulatory (RNS & others) Newmark Security PLC Final Results LSE:NWT Newmark Security Plc

03/10/2018 16:12 UK Regulatory (RNS & others) Newmark Security PLC Preliminary Results for the year to 30 April 2018 LSE:NWT Newmark Security Plc

14/09/2017 07:00 UK Regulatory (RNS & others) Newmark Security PLC Final Results LSE:NWT Newmark Security Plc

"18 Aug, 2022 13:01 Home Business News

EU gas prices seven times higher than in US – CNN

... The United States has stepped up its exports of LNG to Europe in an effort to mitigate the impact of declining flows from the continent’s major natural gas supplier, Russia.

“Every spare molecule we can find, we are shipping to the Eurozone,” Robert Yawger, vice president of energy futures at Mizuho Securities, said.

European gas prices have quadrupled since the start of the year on thinning Russian flows. This week, the cost of gas futures on the TTF hub in the Netherlands exceeded $2,600 per thousand cubic meters for the first time since March. Prices are forecast to spike 60% this winter, exceeding $4,000 per thousand cubic meters."

https://www.rt.com/business/561081-eu-gas-prices-higher-us/

NWT's substantial US business also gives it more protection from the European energy crisis, as unlike the EU the US is energy self-sufficient.

And NWT's business and customer base are not energy-hungry, and the safety and security business is more resilient to recession than many.

"United States energy independence

From Wikipedia, the free encyclopedia

... In total energy consumption, the US produces more energy than it uses. ..."

https://en.wikipedia.org/wiki/United_States_energy_independence

"Chart of the Day 8 September 2022

The pound has fallen to a 37-year low against the dollar

After Liz Truss’s first full day as Prime Minister, the pound sank to its lowest level against the US dollar since 1985.

By Ben van der Merwe

Liz Truss’s first full day as Prime Minister coincided with a foreboding record in the currency markets. As Truss prepared to announce her plan to tackle soaring energy bills, expected to be funded through more than £100bn in government borrowing over the next 18 months, the pound sank to its lowest level against the US dollar since 1985.

The latest exchange rate published by the Bank of England, $1.1467 per pound sterling on 7 September, is lower than the depths plumbed during the turbulent first weeks of the Covid-19 pandemic in 2020, and far lower than anything experienced during the 2008-09 financial crisis.

Though the pound briefly fell to $1.1492 in March 2020, it stayed below $1.17 for only a single day. As of 7 September, the pound has remained below that benchmark for seven consecutive working days.

The pound has lost 15 per cent of its value against the dollar so far this year, and 29 per cent of its value since the UK voted to leave the European Union in June 2016.

A weaker pound makes it cheaper for American consumers to buy from the UK and more expensive for UK consumers to buy goods denominated in US dollars. A weaker pound is likely to be good news for companies that earn most of their revenues in dollars but bad news for those, such as manufacturing firms, more heavily reliant on dollar-denominated imports."

HTTP://www.newstatesman.com/chart-of-the-day/2022/09/pound-falls-37-year-low-against-dollar

The strengthening US dollar, compared to sterling, is great news for NWT, in three ways:-
1. Becomes cheaper to sell to America.
2. Value of NWT's US revenues is increased per dollar.
3. NWT becomes a cheaper takeover target for a US predator.

This has already been reflected in NWT's interim results, where the HCM US revenues rose 62%, to £4.209M., accounting for 43.4% of NWT's £9.697 first half revenues.

And the substantial business that NWT conducts in the US also increases the chance of a US takeover, in two ways:-
1. Brings NWT on the radar screens of more American peers.
2. Makes it more attractive to a US predator wishing to expand domestically.

27th Jan 2022 7:00 am RNS Half-year Report

" ... the strongest performance being from Human Capital Management sales in the US. ..."

https://www.lse.co.uk/rns/NWT/half-year-report-xkas3fz5xzbt7ae.html

"I would certainly think that this project could pipe c. 10 billion cubic metres of gas p.a. to Europe, for decades, which at recent European gas prices could equate to US$ tens of billions in revenue."

I.e. US$ tens of billions in revenue per annum, or course.

Well Serif,

It could suggest that some sort of corporate action is on the way.

And/or that the company wishes to raise its profile within the investment community, to highlights its value.

Either or both of which I believe would be positive.

PPP's huge Saouaf gas project in Tunisia has up to 15.2 trillion cubic feet gross potential in multiple targets.
(This equates to c. 0.43 trillion cubic metres.)

At recent European gas prices, this would equate to an in-situ value of over a trillion US dollars: an increase of multiples this year, due to soaring gas prices.

I would certainly think that this project could pipe c. 10 billion cubic metres of gas p.a. to Europe, for decades, which at recent European gas prices could equate to US$ tens of billions in revenue.

8th Sep 2022 7:00 am RNS Appointment of Broker

London, 8 September 2022 - Pennpetro Energy PLC (LSE: PPP), an independent oil and gas company focusing on development of the Gonzales Oil Field in Texas, USA, today announces the appointment of Arden Partners plc to act as the Company's Joint Broker alongside Peterhouse Capital Limited with immediate effect.

https://www.lse.co.uk/rns/PPP/appointment-of-broker-tisqqqmloxjf366.html

"E.g. There are ten identified Italian gas properties that could potentially add to ZEN's Italian gas revenues, compared to just two at present, a potential six-fold increase."

These ten consist of:-

1. The six of ZEN's nine gas production concessions in Italy (6 operated by ZEN, and 3 operated by someone else), all onshore, that have apparently been mothballed. -
https://www.zenithenergy.ca/operations/italy/

2. Four exploration assets: 2 existing permits, and 2 permit applications.

And as Callit said yesterday, you would think that Italy could emergency fast-track the 2 permit application, given the energy emergency that it is facing.

Recent electricity price in Italy, from 26.8.22 article:-
" ... Electricity prices also continued to soar this week, reaching 718 euros per megawatt hour in Italy. ..."
https://www.thelocal.it/20220826/italy-to-bring-in-new-aid-measures-as-energy-prices-soar/

2nd Sep 2022 11:10 am RNS New record Italian Electricity production revenue
" ... During the month of August 2022, the Company produced a total of approximately 985.6 megawatt hours ("MWh").
Electricity prices during the month of August 2022 averaged approximately EUR 538 per MWh, resulting in net revenues of approximately EUR 530,000. Zenith's current net production costs remain fixed at approximately EUR 35,000 per month. ..."
https://www.lse.co.uk/rns/ZEN/new-record-italian-electricity-production-revenue-4gy3i731ezwzmsw.html

ZEN's August Italian electricity production of 985.6 mWh, at the recent electricity price of EUR 718 per mWh, would equate to EUR 707,660.8 of net revenues, and EUR 672,660.8 of profit.

Which equates to c. EUR 8.072m. of annualised profit p.a.

Plus ZEN's Italian gas revenues, which based on its production last year & at recent gas prices, could equate to EUR 13.15M of revenue (see my Wed 14:07 post yesterday, below), and at very high profit margins.

= c. EUR 21.222M. of annualised Italian energy revenues p.a., at very high profit margins (e.g. c. 90%+ on average).

That's based on the most recent production figures we have, and recent prices.

So the potential for production increases, and even higher prices, could increase this considerably.

E.g. There are ten identified Italian gas properties that could potentially add to ZEN's Italian gas revenues, compared to just two at present, a potential six-fold increase.

And the company is capable of ramping up both its electricity and gas production very quickly and cheaply.

Also note that as ZEN sells into the wholesale market, it wouldn't be limited by a U.K.-style price cap for end consumers (which in any case is being set at a pretty high level).