SEPLAT Petroleum Development Company Plc, a leading Nigerian independent oil and gas company, has reaffirms its growth potential in its core business of exploration and production.
The company has also reiterated its strong operational performance and expansion of the gas business as the shareholders approved a dividend pay-out of US$0.08 per share at its 2016 Annual General Meeting (AGM) held in Lagos.
Addressing the shareholders, the Chairman, Dr A.B.C. Orjiako, said that SEPLAT remained profitable and was able to pay dividend despite sever challenging environment.
On the company’s 2015 results, Orjiako noted that the company made progress in all aspects of its strategy by delivering excellent production and reserves growth.
He said, “Despite the obvious headwinds facing the sector we have made progress on all aspects of our strategy, delivering best-in-class production and reserves growth, and transforming our gas business which achieved 185% year on year growth.”
He pointed out that the company’s expansion drive resulted in the successful completion and commissioning of its Oben gas plan phase I which saw the company’s overall gross processing capacity double to 300 MMscfd (Million standard cubic feet per day).
The chairman further explained that the Oben plan phase II expansion was underway and that when completed, it would create additional processing module that would gross processing capacity to expected minimum level of 525 MMscfd.
He noted that the growth potential of SEPL AT was evident in the significant increase in gas production that impacted positively on the company’s gas business as it recorded 185 per cent increase year-on-year to US$77 million during the period.
Orjiako said that SEPLAT’s position as Nigeria’s leading independent Exploration and Production (E&P) company “has been reinforced in the past 12 months during which we delivered on corporate performance target despite the oil price volatility.”
The shareholders expressed satisfaction at the financial results of the company which enabled it to pay dividend of US$0.08 per share.
Gross revenue for the full-year stood at US$570 million, down 26 per cent year-on-year.
Net profit for 2015 stood at US$67 million and cash flow from operations before movements in working capital stood at US$190 million against capital investments of US$152.
At a post-AGM media briefing, Orjiako expressed delight that the company fulfilled its dividend promise, noting that it declared 4 cents per share as final dividend in addition to the interim dividend of 4 cents per share paid in 2015, bringing the total dividend pay-out to US$0.08 per share.
He lamented over the challenging operating environment in the Niger Delta where oil and gas installations were being vandalized by hoodlums, resulting in huge losses.
“What we have continued to do is to put all of the mechanisms we have always said we will do, especially the way we have engaged our hosts in all the communities we impact.
“From the national perspectives, we are in constant contact with government who is major stakeholder in our business,” Orjiako said.
He said that SEPLAT stands out among other operators as a community-friendly company, noting that its ability to engage its host communities had remained its unique strong point.
According to him, “One of our strongest points that distinguish us as a company is our engagement with our host communities.
“We continuously worked hard to ensure that the host communities take us as host partners and major stakeholders in the business that we do.
“We are happy we have created a lot of prosperity inclusiveness in the areas that we operate; we will continue to build on this.”
Orjiako said that the company had taken precautionary measures against the prevailing oil price slump in the international market, adding that SEPLAT would play a vital role in government’s effort to diversify the economy and fix the deteriorating infrastructure across the country.
“The crude oil price has collapsed all over the world, and we as a company have always known that oil price like any commodity is cyclical.
“When we started the company, in our long term strategy, we did put in place measures to mitigate the cyclical movement because we were going to see high and low prices; so we were prepared for today.”
Reaffirming the company’s strong footing in the gas sub-sector, the chairman said that the company ensured it pursued its expansion progarmme in 2015 so as to achieve the target growth and increase its market share.
He noted that the company’s promise of increased capacity, reserves and gas production was achieved, and that its gas supply to domestic market had witnessed a significant boost.
“SEPLAT is one of the major producers of gas in the domestic market, playing a key role in the nation’s diversification drive.
“I am very happy to say that SEPLAT is playing a major role in that because when we talk about diversification we need to address the challenge of infrastructure and gas-to-power is one area we are focusing on.
“We started with 90 MMscfd; today we are doing 300 MMscfd; at the end of this year we will be doing over 500 MMscufd, all to the domestic market.
Orjiako disclosed that SEPLAT presently produces a little less than 30 per cent of the gas required to fire the gas turbines in this country and expressed delight that the it was able to achieve this because, “getting the power sector right is one major step to diversity the economy.”