The Company reported a profit before tax, PBT, of $28 million, whilst adopting a quarterly dividend policy of US2.5 cents per share in Q1 starting immediately.

A profit before tax, PBT, of $28 million was recorded for the period, up from a loss position of $95.7 million in the same period of 2020 (3M 2020).

SEPLAT maintained a strong cash position of $236.3 million in Q1 2021, with an EBITDA position of $77.8 million.

Commenting on the results, which were released to the NSE and LSE on Thursday,  Roger Brown, the Chief Executive Officer of the Company, said: “We have made a progressive start to the year, delivering oil and gas production volumes of 48,239 boepd, within our guidance range. With the Gbetiokun field at OML40 now back in production, we are currently achieving average daily volumes of nearly 54 kboepd so far in April and we will build on this as we add additional oil and gas wells this year.

“Our flagship ANOH gas project is proceeding as planned and was fully funded in February when our joint venture company, AGPC successfully raised $260 million of debt financing. In addition, the success of our $650 million Eurobond issuance in March demonstrates investor confidence in our prudent financial management and the exciting future ahead for the Company and its stakeholders.”

The SEPLAT CEO further explained: “As we drive forward our strategy of being a low-cost energy provider delivering reliable, affordable and sustainable energy to the young, fast-growing population of Nigeria, energy transition – which delivers on Nigeria’s social development goals in tandem with the climate agenda – is essential.”

“This is the backbone of Seplat’s strategy and we will be communicating how we plan to achieve this over the coming months. To that end, the Board took the decision to change our name to Seplat Energy PLC, which more adequately reflects our ambitions of providing a broader energy mix. We will present the name change to our shareholders for approval at the AGM on 20 May 2021,” he said.

Highlights

Operational:

• Working-interest oil and production within guidance at 48,239 boepd
• Average daily volumes of nearly 54,000 boepd achieved in first 21 days of April
• Liquids production of 28,541 bopd in Q1 2021
• Gas production of 114 MMscfd (19,698 boepd)
• Low unit cost of production of $8.70/boe
• Oben-50 gas well now producing, Oben-51 drilled and completed with gas expected to flow in May
• Safety record extended to more than 17 million hours without LTI on Seplat-operated assets

Financial: 

• Board adopts quarterly dividend policy; declares Q1 2021 dividend of US2.5 cents per share
• Revenue up 16.8% to $152.4 million
• EBITDA of $77.8 million
• Cash at bank $236.3 million, net debt of $458.1 million
• The successful issue of $650 million 7.75% senior notes to redeem existing $350 million 9.25% senior notes and repay $250 million drawn on $350 million RCF
• Refinanced $100 million Westport RBL facility
• Total capital expenditure of $32.6 million

Corporate Update:

• Seeking shareholder approval at the AGM on 20 May 2021 to change the name to Seplat Energy PLC to reflect an evolving strategy
• ANOH project now fully funded following successful $260 million debt issue
• Plan to host Capital Markets Day on 29 July 2021

Outlook for 2021

• Expected production unchanged at 48-55 kboepd for full year, subject to market conditions
• Capex guidance unchanged, expected to be $150 million for the full year
• 5.0MMbbls hedged at $35-$45/bbl from Q2 to Q4 2021

“For 2021, we expect to produce an average of 48,000 – 55,000 boepd, taking into account the impact of OPEC+ quotas. We continue to hedge against oil price volatility and expect a higher proportion of revenues to come from long-term gas contracts at stable prices.

“We have significant cash resources and will continue to manage our finances prudently in 2021, expecting to invest $150 million of capital expenditure across the full year, with nearly $33 million already invested. We remain confident that our ongoing cost-cutting initiatives and prudent management of cash will enable further reductions in debt, whilst supporting dividend payments and investment for growth.

“Following its successful funding, the completion of the ANOH project remains a major priority. Although we expect some COVID-19 related delays to push completion into early 2022, following a cost optimization program we now expect the project to cost no more than $650 million, substantially below the $700 million budget previously stated at Final Investment Decision,” the report said.