Summary:

On 16 July 2025, Canadian energy firm Zenith Energy announced that the Arbitral Tribunal had fully rejected the claims filed by its subsidiary, Canadian North Africa Oil and Gas Limited (CNAOG), in the ICC-2 arbitration against the Republic of Tunisia.

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The case, launched in December 2023, concerned the Sidi El Kilani (SLK) concession, where Zenith sought around US$130 million for alleged lost revenues, denied crude allocations, and the non-renewal of a 45% stake. 

From Tunisia’s perspective, the Canadian energy firm, despite failing to provide the necessary technical and financial guarantees, acquired all the shares of its Chinese partner to assume its rights. Tunisian authorities view this as a violation of national regulations governing hydrocarbon exploitation. 

Zenith said it would appeal the ruling before the Swiss Federal Supreme Court, citing procedural irregularities. 

The rejection comes amid a broader legal standoff between Zenith and Tunisia. In 2023, Zenith filed multiple claims, including a US$48 million ICSID case and a second ICC arbitration against ETAP, Tunisia’s national oil company, alongside the seizure of US$6.5 million from ETAP’s Swiss accounts. 

In 2024, Zenith temporarily halted production, blaming non-payment and sales obstructions by Tunisian authorities. The company is also pursuing a larger ICSID claim, valued at US$503 million, with hearings expected in 2026. 

Outlook: 

While the dismissal of the ICC-2 arbitration may weaken Zenith’s legal standing in Tunisia and potentially undermine investor confidence in its North African operations, it could conversely strengthen Tunisia’s international legal position, particularly in the energy sector. This ruling may also enhance Tunisia’s reputation in both the legal and energy fields, serving as a counterpoint to the prior negative media around the Zenith case. 

Tunisia’s strengthened position following this dismissal could deter future arbitration claims and reinforce its position in ongoing disputes. 

However, as Zenith’s legal challenges continue, and with other pending disputes such as Minerali Industriali’s ICSID claim over export tax hikes, the broader conflict between Tunisia and certain foreign investors remains unresolved, requiring careful management of investor-state relations moving forward. 

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