Seplat Energy, a leading Nigerian independent energy company listed on both the Nigerian Exchange Limited and the London Stock Exchange, announces its audited results for the full year ended 31 December 2021.

Operational highlights

• Strong safety record extended, 28 million hours without LTI from Seplat Energy operated assets
• Delivered robust performance against challenging year for Nigerian oil & gas industry 
• Working interest production averaged 47,693 boepd, impacted by August and December FOT shut ins
• Completed nine wells: five oil and four gas wells   
• Eland's OML 40: four wells drilled at a total gross cost of US$60million, now delivering 15.5 kbopd (gross)
• Sibiri exploration on OML40 drilled to TD in February with initial indications it has encountered eight oil bearing reservoirs with 353 ft of gross hydrocarbon pay, net pay of 229 ft; further data acquisition and analysis are underway

Financial highlights  

• Revenues up 38% to $733 million ($747 million including $14 million underlift)
• Adjusted EBITDA up 40% to $372 million,
• Strong cash generation of $394 million against capex of $137 million (excluding cost of rig acquisitions)
• Strong balance sheet with $341 million cash at bank, net debt of $426 million and
• Q4 dividend of US2.5 cents per share recommended

Corporate updates

• Name changed to Seplat Energy to reflect evolving strategy
• Proposed $1.28 billion MPNU acquisition adds transformational shallow water portfolio with dedicated export routes
• AEP mechanically completed in January, hydrocarbons introduced into line as part of commissioning process,
• commercial agreements to enable production into terminal being finalised; injection expected in March
• ANOH project mechanical completion expected H2 2022 (84% complete at present, all materials in country), however delays to third-party spur line likely to delay first gas to H1 2023
• Related party transactions eliminated from 1 January 2022

Outlook for 2022 (excluding MPNU)

• Production guidance of 50-60 kboepd, capex expected to be $160 million
• MPNU next steps: focus on government approvals and transition planning, completion expected H2

Roger Brown, Chief Executive Officer, said:
"Seplat Energy announced a major acquisition last week and despite a challenging year for Nigerian oil and gas, the robust results delivered today clearly show how our increasing financial strength has made such an acquisition possible, without the need to dilute shareholders, by giving international financial partners the confidence to invest in our vision.

The addition of MPNU nearly trebles our production and doubles our reserves on a pro forma 2020 basis, reinforcing 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.

Our 2021 performance was affected by outages at Forcados Terminal that will no longer have such an impact when we switch to the new Amukpe-Escravos Pipeline, which we expect to launch in March. This is part of our strategy to diversify and derisk routes to market, assuring higher revenues from significantly better uptime and lower reconciliation losses. Furthermore, once we have completed our acquisition of MPNU, we will add significant production from offshore assets with dedicated export terminals that also have higher availability and lower reconciliation losses. 

The addition of MPNU offers 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.  

Our financial strength is matched by the skills and ambitions of our staff and we look forward to welcoming more than a thousand highly trained colleagues from MPNU and working with them to ensure their smooth onboarding into Seplat Energy. Together we will build a sustainable, world-class company that generates attractive returns for stakeholders and delivers energy transition for one of the world's largest and most rapidly growing populations."   

KeyFacts Energy: SEPLAT Nigeria country profile