Seplat Energy, a leading Nigerian independent energy company listed on both the Nigerian Exchange Limited and the London Stock Exchange, has announced its unaudited results for the three months ended 31 March 2022.

Operational highlights 

• Strong safety record extended to 26.1 million hours without LTI from Seplat Energy operated assets
• (2.0m hours in Q1 2022)
• Working interest production averaged 47,603 boepd (liquids 29,079 bopd, gas 18,524 boepd) 
• Full-year guidance remains unchanged at 50-60 kboepd
• Amukpe-Escravos Pipeline mechanically completed, all commercial terms have been agreed and are moving through counterparty approval processes for signature. Expected to be fully operational by end of Q2 2022.
• Sibiri exploration well drilled and successful, data analysis underway, working with partner to secure regulatory approval for Extended Well Test
• Decision to exit Ubima to focus on more profitable assets; agreement reached to sell Seplat Energy’s share to its JV partner for $55 million.  2P reserves reduce by 2 MMboe from 457mmboe to 455 MMboe.

Financial highlights  

• Revenues up 58.6% to $241.8 million  
• EBITDA up 81.6% to $147.4 million (adjusted for non-cash items)
• Strong cash generation of $178.7 million, capex of $25.7 million 
• Strong balance sheet with $312.2 million cash at bank, net debt of $442.6 million  
• Q1 interim dividend of US2.5 cents per share    
• Update on proposed acquisition of Mobil Producing Nigeria Unlimited
• Sales & Purchase Agreement signed on 25 February to acquire Exxon’s shallow water operations in Nigeria, Mobil Producing Unlimited, Nigeria (MPNU)
• Acquisition remains on track and awaiting necessary approvals, expected to complete in H2 2022

Roger Brown, Chief Executive Officer, said:
“Seplat Energy delivered a good quarter that benefited from higher oil pricing, which offset lower production owing to continuing problems with the Trans Forcados Pipeline. However, the alternative Amukpe-Escravos Pipeline is mechanically complete and once we have signed the commercial agreements, we expect Chevron to be lifting our oil through the Escravos Terminal in the third quarter. 

Our proposed acquisition of MPNU remains on course. We are awaiting the necessary approvals from government and regulators and expect the transaction to complete in the second half of this year. The effective date of 1 January 2021 means we will benefit from higher recent oil prices and as we have previously reported, the addition of MPNU will nearly treble our production and double our reserves on a pro forma 2020 basis. The acquisition will reinforce our leadership of Nigeria’s indigenous energy sector and enabling us to generate strong future cash flows that will underpin our investment in Nigeria’s energy transition and improve our overall stakeholder returns. It will also bring a significant undeveloped gas resource base which, alongside our ANOH gas project development, will underpin Nigeria’s energy transition and drive domestic and export revenues when developed.

We announce the decision to divest the Group’s interest in the Ubima marginal field for a consideration of $55million, which marginally reduces the company’s 2P reserves by 2 MMboe to 455 MMboe. 

We have proven we have the financial strength and credibility to attract international finance into Nigeria’s energy sector and this will help us in our aim to deliver energy transition and provide cleaner, more reliable and more affordable energy for Nigeria’s young and growing population.”