Zenith Energy (LON: ZEN), the oil, natural gas and electricity producer, has seen its shares rise on Thursday after it said electricity production activities in Italy have been generating record profitability.
The company has been generating an average of approximately 900 MWh per month at the Torrente Cigno concession, where low-grade natural gas production is used to generate electricity.
Zenith said in a statement that the electricity has been sold at an average sale price of approximately EUR 110 per MWh resulting in net revenues of around EUR 110,000 per month.Â
The company's current net production costs are about EUR 35,000 per month.Â
Luca Benedetto, Chief Financial Officer and Managing Director of Italian operations, commented: “We are delighted with the record profitability of our electricity production at Torrente Cigno made possible by the favourable price of electricity in Italy at this time.
“By way of comparison, electricity prices in September 2020 were in a range between approximately EUR 45 – 55 per MWh.
“It is our intention to replicate our successful model of electricity production at Torrente Cigno on a larger scale in certain African jurisdictions, following the identification of a suitable oil and gas production asset.”
Zenith Energy shares have rallied 12% on the news to 1.12p per share. In July, Zenith shares soared over 23% after the sale of its Tunisian oil production.
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