- Zenith Energy made this decision following a detailed assessment of recent geopolitical developments near Benin.
- The firm was engaged in legal and technical work alongside Benin’s Ministry of Water and Mines to finalize the PSC for Block 1 until April 2023.
Zenith Energy, a Canadian oil and gas company, has cancelled negotiations with the Ministry of Water and Mines of the Republic of Benin for a production sharing contract (PSC) for Block 1, including the Sèmè oilfield located offshore Benin. Terminating the PSC for Block 1 comes less than four months after the legal and technical negotiations kicked off. The block, situated in shallow water with onshore facilities and a tank farm for oil production processing, was discovered in 1967 by Union Oil. Block-1 covers 551 km2, with recent 3D seismic data spanning over 355 km2.
The company’s board made this decision following a thorough assessment of recent geopolitical developments near Benin, the substantial long-term investment required for the successful development of the Sèmè oilfield and the progress made in other jurisdictions. The firm intends to focus its technical and financial resources in jurisdictions with comparatively reduced risk for its shareholders.
Zenith Energy was granted a three-month exclusivity period starting in January 2023 to finalize the terms of the PSC. During that period, the firm submitted an offer to the government of Benin on September 15, 2022, to obtain a nine-year operating license for the block. Until April 2023, Zenith was engaged in legal and technical work alongside Benin’s Ministry of Water and Mines to finalize the PSC for Block 1.