Summary:

In late-October 2023, Canadian firm Zenith Energy announced the opening of a second arbitration case against the Enterprise Tunisienne d’Activites Petrolieres (ETAP), Tunisia’s nationalized oil company.  

In early June 2023, Zenith issued a $48 million claim with the International Center for the Settlement of Investment Disputes (ICSID) claiming that the Tunisian government was materially harming the business interests of the firm. In July 2023, Zenith seized $6.5 million from accounts in Switzerland owned by ETAP. 

The second arbitration case was lodged with the International Chamber of Commerce (ICC) in Paris, France without a specific dollar amount disclosed. 

The claim comes as Tunisia’s nationalized entities struggle under growing budget pressures amidst systemic challenges in the extractives sector.

Outlook:  

Challenges in the extractives industry have been growing for months, with many international firms rumored to be discussing exits from the Tunisian market. 

Much of the frustration centers on Tunisian bureaucracy. Local communities typically welcome foreign investment and opportunities for employment, however, the investment climate is increasingly unwelcoming with labyrinthine administrative processes unfamiliar to foreigners. 

As the government budget crisis deepens, similar issues are likely to continue to emerge as foreign investors are caught in unsustainable relationships with struggling nationalized firms. 

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