Seplat Energy Grosses N258.7bn Q3 Revenue

Roger Brown, CEO., Seplat Energy
Roger Brown, Seplat CEO

Seplat Energy Plc, a leading Nigerian independent energy company listed on both the Nigerian Exchange Limited and the London Stock Exchange, announces its unaudited results for the nine months ended 30 September 2022, recording a rise in profit before tax by 90.3 per cent to N77.5bn from N38.6bn year-on-year. The company also generated cash from its operations to the tune of N154bn from N64.9bn year-on-year, rising by 124.7 per cent.

The energy Company’s also grew its revenue by 34.4 per cent to N258.7bn from N182.7bn year-on-year; as its gross profit soars to N118.5bn from N58.1bn year-on-year, rising by 93.5 per cent.

Seplat Energy is paying Q3 dividend of US2.5 cents per share, taking 9M 2022 total to US7.5 cents per share ($44.1 million paid in the period).

In its operations, Seplat Energy demonstrated a strong safety record, which extended to 30.5 million hours without lost-time injury at Seplat Energy-operated assets; eight (8) wells completed, another seven wells to be drilled in Q4 (currently drilling four wells); and the Amukpe-Escravos Pipeline commenced commercial operations in August, with 700 kbbls lifted in October.

Financial highlights

• Revenues up 34.4% to $618.6 million ($678.9 million including underlift), driven by higher realised oil prices of $108.25/bbl.

• EBITDA up 27% to $337.9 million (adjusted for non-cash items)

• Strong cash generation of $368.1 million, capex of $110.3 million

• Strong balance sheet with $304.8 million cash at bank, net debt of $452.2 million

• Production opex of $9.3/boe

• Average realised gas pricing sustained at $2.80/Mscf despite pricing pressure on domestic gas delivery obligation

• Received $13.4 million out of a total of $55 million in accordance with Ubima divestment agreement

• Q3 dividend of US2.5 cents per share, taking 9M 2022 total to US7.5 cents per share ($44.1 million paid in the period)

Operational highlights

• Strong safety record extended to 30.5 million hours without lost-time injury at Seplat Energy-operated assets

• Volumes of 43,337 boepd, impacted by oil theft and outages of key infrastructure

• Amukpe-Escravos Pipeline commenced commercial operations in August, 700 kbbls lifted in October.

• Eight wells completed, another seven wells to be drilled in Q4 (currently drilling four wells)

• Full-year guidance adjusted downwards to 40-44 kboepd owing to pipeline and export terminal outages, which were materially worse in Q3; capex maintained at $160 million, capex per well lower due to improved drilling performance

Update on proposed acquisition of Mobil Producing Nigeria Unlimited (MPNU)

• Seplat Energy reiterates that the Sales & Purchase Agreement (SPA) signed on 25 February 2022 to acquire Exxon’s shallow water operations in Nigeria, MPNU, remains valid

• The Company remains confident that the proposed acquisition will be brought to a successful conclusion in accordance with the law

Q3 corporate updates

• Provisional applications to the NUPRC (Nigerian Upstream Petroleum Regulatory Commission) for the voluntary Petroleum Industry Act (PIA) conversion of operated Oil Mining Leases

• Successfully refinanced existing $350m RCF due September 2023 with a new three-year $350 RCF due April 2026

• Seplat West (OMLs 4, 38 &41) awarded ISO 55001 (Asset Management), a first for an African E&P company

Commenting on the results, Mr. Roger Brown, Chief Executive Officer, Seplat Energy Plc, said:

“Despite an unusually challenging quarter for the Nigerian oil and gas industry, with key export routes being unavailable because of force majeure, we have demonstrated that we have a resilient business. The Amukpe-Escravos Pipeline has been operational since August and we have had our first oil export this month. The Trans Forcados Pipeline has now resumed operations and we continue to increase our use of alternative export routes, giving us confidence that the final quarter of the year will show some improvement in volumes.”

“We are working closely with all the relevant stakeholders on our transformational acquisition of MPNU and remain confident that the proposed acquisition will be brought to a successful conclusion in accordance with the law. The acquisition will add significant reserves and production capacity that will strongly reinforce Seplat Energy’s position as Nigeria’s leading indigenous oil and gas producer.”