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Also, as I pointed out months ago I expect a chunk of the $5.3 million that is owed to be written off to pay for the signature bonus and I then expect terms to be agreed for the repayment of the rest. It is not in dispute that the money is owed and with the IMF having given the Congo a $448.6 million credit line just 18 months ago on July 11th 2020 the country has to be very careful to operate properly and pay off debts that are owed otherwise they run the very real risk of this line of credit being pulled. Why would you risk a $450million line of credit in order to not pay a $5.3 million bill? You wouldn’t especially when you can write off some of the $5.3 against the signature bonus and agree reasonable payment terms for the rest.

So this idea that the Congo can just write off the $5.3 million with no consequences is a total nonsense. Not paying their debts on small amounts has a massive impact on huge lines of credit for them. If anything it is the opposite d to what you said - the easiest way for them to keep getting money is to pay debts like the one to which that they owe Zenith.

Barnyards, you have no idea what you are talking about. You totally embarrassed yourself two weeks ago when you gave us all dire warnings about what a bad idea it was for Zenith to sue the SMP because it would prevent them repayment of the $5.3 million. only to have it pointed out to you that this was a French drilling company and not the SNPC.

No research, no likee lol.

The trigger will of course be the company getting a new 25 year Tilapia license approved. From that point, Zenith will then be able to:

1) Send out the drilling rig to Congo and get a drill date booked in.

2) Be able to get a repayment plan for the SOCAR money into action - this is not linked to the license renewal, but since the company has mentioned that the $2 million signature bonus will be paid to the govt out of the SOCAR money then this will be a very good sign that the rest of the cash will be forthcoming.

3) With a rig in place and a license in hand then as has been mentioned by Canary this should put Zenith in a great place to acquire multiple other licenses in the region that it will be able to drill quickly. If all goes well then the rig should never really stop working on Zenith wells.

Once the Tilapia license is approved and the rig is in place sentiment around Zenith will be buzzing in the same way that it was around AAOG just before they drilled their first well when their market cap peaked at approximately £30 million. Zenith also have the advantage that they know exactly what to do to with the sidetrack to repair the damage done with AAOG's drill and the company's market cap is only £4 million currently.

Also, if you add in the imminent approval of the Tunisian assets where Zenith have been able to acquire 45% of Sidi El Kilani for $800,000 and this will deliver 300bopd for an approximate revenue of $4.5 million per annum. When you think that the revenue from Azerbaijan was only ever USD$3.2 million gross, Tunisia is already worth more to the company than Azer ever was and at a fraction of the cost.

Even though to most of us Tunisia is only a small sideline distraction from the reward that Tilapia could potentially bring we should still not overlook it’s value to the company. It is important in financial terms but also because of the connection that it has given AC with the Kuwiatis and the Chinese. If you remember in a recent RNS he mentioned that he hoped to purchase additional assets of both of them and if he can get then as cheap as he did Sidi El Kilani then we are onto a winner.

I have noticed recently that sentiment on this board has turned much more bullish for Zen’s prospects and I am glad of this and the quality of the posts has also gone up considerably. Cliveas’ findings on the details of the BD260 rig yesterday are a case in point.

Good luck to all invested here, but I think that we will have a lot to be happy about in the near future, commencing as investversmart says with the trigger-pull of the Tilapia announcement.

Great find Cliveas - The original well that was drilled in the Congo was drilled by the SMP 102 rig – as per the AAOG RNS from 25th June 2018.

If we cross-reference this against the SMP website: https://www.smp-drilling.com/ then we can find the specs for the SMP102 rig there. https://www.smp-drilling.com/rigs.html

The SMP 102 rig had 1,000 hp and a Static Hook Load of 190 tons whereas the BD 260 has a 1200HP drilling rig and a static hook load of 260 tons.

The SMP102 rig would have been good enough to complete the original Tilapia well if the SMP crew had not messed up the drill. Obviously the fact that the rig had technical failures did not help but that is what the court case is all about.

The SMP102 rig was in poor condition when it arrived at the Tilapia site but it was obviously capable of doing the job or AAOG would not have booked it in the first place. The job was messed up by a poor crew that drilled the well badly.

The BD260 rig that Zenith own is a much stronger more powerful rig than the SM102 and as Clieveas has pointed out, the BD 260 well can drill down to 4600m and the sidetrack only needs to be drilled to a depth of 2,900m so the BD260 it will clearly be able to do the job.

Truthfactory - the big advantages that Zenith have are twofold compared to AAOG

1) Direct contact between AC and the President of the contact. We know that they have met at least twice now as there are pictures on Twitter of the meeting in February and last month. In a country like the Congo that direct connection to the man at the top of the decision-making tree is incredibly important.

2) The fact that Zenith own their own oil rigs is also a huge difference between themselves and AAOG. This will save an enormous amount of money and will mean that instead of being like AAOG and having to pay out all of the money for the rig hire and then chase SOCAR for it later.

Both these factors are important but the ownership of their own rig out in the Congo is an absolute game changer for Zenith as opposed to how AAOG operated. Zenith will have the rig available whenever they like and to drill as many wells as they like. They will not have to spend months negotiating with suppliers for rigs and then be provided with substandard equipment and teams.

In terms of cost it will be night and day difference also. Zenith will have only the cost of the rig crew to pay and will be able to charge SOCAR for their share of the rig crew AND the hire of the rig. Basically they are likely to come out in profit on the whole deal when Socar pay and only at a small expense that they have to pay up-front (the rig crew).

It is a massive difference. Zenith will also be able to hire their own crew for the rig and make sure that they are experienced and competent. If you recall from the AAOG Tilapia drill the cost of getting the rig in place and then the difficulties that they had in working with equipment going wrong caused huge problems with the drill. Also, the technical execution of the drill was poor.

Nobody can guarantee success but in owning their own rig and with the right drill team put in place then Zenith have an excellent chance of making Tilapia an incredibly successful project.

As to logistics being an issue - I cannot see how. If they hired a rig from somebody else then they still have to get the rig to site but need to pay more money to do this. We know the site is accessible because AAOG got the rig there, so I think that you are imagining problems where none exist.

Zeb - As I mentioned in my original reply they have the 1200hp rig AND a truck mounted rig which they can send wherever they want so I guess that answers your question positively from the company's own mouth.

Regarding the 1200hp rig being overkill for Tilapia - even if it is then I don't really see a problem. Zenith using their own rig is always going to be cheaper than hiring somebody else' so it makes more sense to use it rather than not.

Zebediah16 - Both rigs are going to the Congo.

If you look at page 10 in the annual report it says: "As publicly announced, the Company has presented a comprehensive commercial and technical offer (the “Offer”) to the Ministry of Hydrocarbons of the Republic of the Congo in order to be awarded a new 25-year license for the Tilapia oilfield (to be named Tilapia II). We are confident that we shall be successful in obtaining a new 25-year license. In the event our Offer is accepted, the Company will look to deploy its 1,200hp drilling rig in the Republic of the Congo in order to begin drilling activities in well TLP-103C."
https://wp-zenith-2020.s3.eu-west-2.amazonaws.com/media/2020/10/29105540/Zenith-Energy-audited-results-2020-FY-Final-28.10.2020.pdf

Also in the Norwegian investors conference call from August 20th AC also pointed out that Zenith own two drilling rigs – one stationary heavy one and the other a truck-mounted workover rig. He pointed out that they can use these rigs in whatever country that they want and this could easily be Congo after the confirmation of the Tilapia2 license.

So it is pretty clear that the rigs are definitely not forgotten about and are going to be used in the Congo once the license is granted.

Barnyards, you have made a very ill informed post this morning which if not corrected could be very misleading to genuine investors.

The SNPC (the National Oil Company of Congoi) are the entity that are connected to the Congolese government and that owe AAOGC $5.3 million.

The SMP (Société de Maintenance Pétrolière) are the entity that Zenith are suing in the French courts for $3.1 million. They are a French drilling company that provided the rig and the operators for AAOG's ill fated Tilapia drill back before Zenith took the company over: https://www.share-talk.com/anglo-african-og-lonaaog-dispute-with-smp/#gs.klpdlz

There is absolutely no connection between the two entities apart from the fact that they share some of the same letters in their names. A legal case against SMP will therefore have no impact whatsoever on the likelihood of Zenith renewing the licesnse for Tilapia.

Docit – as GaryMegson pointed out, it has long been known that Zenith intend to use their own rigs to drill in Tilapia. They already own two rigs that they were using for work in Azerbaijan and since they have now completely gotten out from that region it will be easy enough for them to move the rigs to the Congo if/when they get granted the Tilapia license.

AC mentioned this out in his investor conference call back in August where he pointed out that Zenith have one stationary heavy rig and also a truck-mounted workover rig that they can use these rigs in whatever country that they want. This was reiterated in the annual report last week on page 8 of the where it sad: “In the event our Offer is accepted, the Company will look to deploy its 1,200hp drilling rig in the Republic of the Congo in order to begin drilling activities in well TLP-103C.” https://www.rns-pdf.londonstockexchange.com/rns/5456D_1-2020-10-28.pdf

The other thing that AC mentioned in the investors conference call was the fact that the reason so many people have been attracted to the Tilapia license is because of the amount of money spent on it by AAOG and that their well was never fully completed. He said that it is very clear what went wrong with the AAOG well and that this was the fact that the execution was poor. Thanksfully, they did not fully complete the well as this may have damaged the reservoir structure, but because they didn’t then all Zenith have to do is deepen it by drilling a sidetrack which is technically convenient and not a complicated process. The investors conference call can be heard here: https://www.youtube.com/watch?time_continue=9&v=_xs0jhkcieE&feature=emb_logo

So, in short, Zenith have their own rig to drill Tilapia and they know the mistakes that were made in AAOG’s previous drill as well as how to rectify them. All they need to do now is to get a new 25 year license handed to them and while this is not 100% certain the picture of AC with the DRC President here: https://twitter.com/CattaneoGenoa/status/1321781146091401220 and the comments in the annual report that “We are confident that we shall be successful in obtaining a new 25-year license” indicate that they have been given some good assurances that they will receive this license imminent.

I can’t help thinking that the fact that Zenith have their own rigs and would therefor be able to conduct a long-term drilling campaign without having to wait for new equipment would be a big reason that the DRC govt would choose to grant them the license rather than one of the other applicants. It just makes everything much cheaper, quicker and simpler.

What's really interesting is that when you put this picture together with what the company say on page 6 of the annual repor that says:

"The acquisition of AAOG Congo has not only enabled Zenith to acquire an existing operator in the Republic of the Congo, but also US$5.3 million in receivables owed to AAOG Congo by Société Nationale des Pétroles du Congo (“SNPC”), the national oil company of the Republic of the Congo, which will be offset by a US$2 million signature bonus payable to the Republic of the Congo as part the application for a new licence."

So they have already got to a stage where the amount of the signature bonus has been negotiated and that it has been agreed that it will be paid out of the $5.3 million. Put that together with the picture of AC and the President and it looks like things are being worked out for Zenith to get a new 25 year Tilapia license imminently. As Cliveas said - if no, why meet him.

You cannot just look at AC's pay in isolation. You have to look at the remuneration of the whole board and then compare it to its peer companies in order to get an accurate idea of where the company stands on remuneration.

Using the most recently available accounts this is as follows

UKOG (2019) £1,087,000
Block (2019) £916,262
Coro (2019) £887,250
Zenith (2020) £862,556
AAOG (2019) £572,000

So in this context the wage expense is actually not that high, regardless of how you want to spin it.

There will be no demise of Zenith. The suspension is a technical issue and good news will be just around the corner. The company has consistently maintained that things are going well with Congo negotiations and so hopefully we will hear some good news this week.

Wow. Just wow.

Congratulations everybody. After all these years we deserve this!!

Goodwin's law should probably be updated to change the word Hitler to Trump in order to incorporate the modern breed of online moron.

What you all seem to be overlooking is that the suspension here is a completely technical one over the compliance issue about the publishing of the audited accounts. As soon as the audited accounts are published then the suspension will end.

The reason that they audited accounts have not been published appears to be due to the fact that it is at the moment completely unclear whether Zenith have the Tilapia license or not. Obviously, they did on the 31st March, they do not now and they think that they will again in a couple of weeks time.

All being well, the Tilapia license renewal will come out shortly along with some further clarity about the $5.3 million owed from Socar and then the audited results will come out with a significant jump in share price.

However, as I keep on saying, the really important thing about Zenith nowadays is that they are not a one-trick pony like they were in Azerbaijan. The company also has the Tunisian assets which will generate approx. 500-600 bopd (about $3.8-4.7 million per annum) and are just waiting on approval from the govt and also has potential asset acquisitions going on in Nigeria and Gabon. All of these bits including the $5.3 million are completely independent from each other and so to keep harming on that this suspension is somehow the death knell for the company and it’s shareholders is clearly nonsense.

On BORS...."Reference is made to today’s announcement from Zenith Energy Ltd (“the Company”) at 11:38 CET.

On this basis Oslo Børs has decided to immediately implement a suspension of the trading of the Company’s shares, in accordance with the Merkur Market Continuing Obligations section 11.3."

This fits in with the theory that it was London that asked them to suspend and then Oslo followed on because you can't have it suspended on one exchange and not the other.

So Zenith have requested a suspension based on the fact that the audited accounts have not been published. I agree with Mudstud on this occasion, I do not think that it is due to the imminent publication of news on Tilapia.

My guess is that it must be do with regulators in London not being happy about the fact that the audited accounts have not been completed in the required timescales as Norway seemed to be happy with special observation. However, generally if a company is suspended on one exchange it will be suspended on all exchanges.

The good point is that the RNS makes it clear that it is a technical suspension and one that will be lifted once accounts are published: “The Suspension has been requested as the Company has yet to publish its audited financial statements for the year to 31 March 2020 in accordance with the requirements of part 4.1 of the Disclosure Guidance and Transparency Rules (the "Annual Report"). The Company will seek the lifting of the Suspension on the publication of Annual Report”

We know that they appear to get news on Tilapia by the week of October 19th and this will have to be announced even with the share suspended so I guess there will be a big rise (or fall) when it reopens based on the Tilapia news.

Well, given the suspension, the share price is not going to move between now and us knowing Tilapia so those of us that are invested are going to get a big win if the Tilapia news comes out positive (which I think it will) and those who are out will just have to watch from the sidelines.

As Mudstud and mls678 have said (and I absolutely agree with for once) It is binary now for holders. If we get Tilapia we are going to be very happy and make a lot of money. If we don’t it will be the opposite. Because one thing is for certain - we will know about Tilapia before the audited accounts are published and before the share suspension is lifted.

Well, I have to admit I was not expecting that.

Buko - yes you are absolutely right, I stand corrected.

Between 2-2.5 weeks max until the state of play with the Tilapia license is definitively known then.