Seplat Energy’s operating profit rises to N285.2 billion in H1 2024
...Declares US6 Cents total dividend per share for half year
By Edu Abade
Leading Nigerian independent energy company listed on both the Nigerian Exchange and the London Stock Exchange, Seplat Energy PLC, has announced its unaudited results for the six months ended June 30, 2024 and declared US6 Cents total dividend per share for the period.
The company grew its profit before tax (PBT) to N244billion from N43.5billion Year-on-Year with earnings hitting N308.2billion, while its production averaged 48,407 boepd (H12023:50,805 boepd) at midpoint of guidance (44,000 boepd-52,000 boepd).
In the same vein, Seplat Energy advanced its operating profit to N285.2billion from N60.2billion Year-on-Year and achieved over 4.9 million hours without Lost Time Injury (LTI) at its operating assets in the first six months of 2024.
Details of its financial highlights revealed that its revenue hit $421.6million from $547.0million in H1 2023 (as H12024 reported underlift of $55.8million as against H1 2023 overlift of $59.4million).
Average realized oil price $85.55/bbl compared to $79.54/bbl in the same period of the previous year, while average realized gas price amounted to $2.95/Mscf as against $2.87/Mscf in 2023
Seplat’s unit production opex stable stood at $9.7/boe compared to $9.6/boe in HI of 2023, while adjusted EBITDA rose 13.3 percent to $267.3 million in first half of 2024 compared to $235.8million in 2023 due to lower costs.
Also cash generated from operations dipped from $226.0million in HI 2024 from $260.0million in the corresponding period of 2023,but cash generated from operations in 2Q 2024 rose to $209.2million from $16.8million in the first quarter.
While Capex invested increased to $102.4million from $88.8million in 2023, balance sheet cash as of the first half of 2024 rose to $371.8million from $335.6million in Q1 2024, excluding $128million deposit from Mobil Producing Nigeria Unlimited (MPNU).
Net debt also dipped to $366million as of June ending from $385million at end 1Q 2024, while $19.3million of Reserve-Based Lending (RBL) borrowings were repaid in H1 2024 with a net debt to EBITDA at 0.76x.
Total declared dividends for first half of 2024 amounted to $6.0 c/share as against $3.0 c/share in Q2 2024 $6.0 c/share in H1 2023
Its corporate updates revealed that full year guidance remained unchanged and production reached 44,000-52,000 boepd, while the Capex peaked at between $170million and $200million.
“On June 14, 2024, we announced that we had been notified of a settlement reached between the Nigerian National Petroleum Company Limited (NNPCL) and MPNU with regards to the MPNU transaction and termination of the court proceedings. Seplat is focused on securing regulatory approvals in the near-term,” it said.
Details of the operational highlights showed that production averaged 48,407 boepd (H1 2023: 50,805boepd), at midpoint of guidance (44,000 boepd-52,000 boepd). Pipeline losses of 3.1 percent in 6M 2024, highlights an improving environment for stable operations on the Niger Delta, while average deferments also improved to 24 percent (H1 2023: 26 percent).
Its ANOH gas project is on track to reach first gas by the end of Q3 2024, just as critical infrastructure progressed well in 2Q 2024; spurline achieved mechanical completion and progress on OB3 pipeline tunneling means both infrastructure projects are due for completion in 3Q 2024.
The company also reported that the Abiala-1 work over activity has been completed and the second well commenced and first oil is expected in 3Q 2024, while Sibiri-1 and Sibiri-2 on stream are producing at a combined gross rate of c.3,000 bopd.
With its carbon emissions intensity at 28.6 kg CO2/boe (H1 2023: 26.3kg CO2/boe), the company said it achieved over 4.9 million hours without Lost Time Injury (LTI) at its operated assets in H1 2024.
Commenting on the results, Chief Executive Officer, Seplat Energy, Mr. Roger Brown, said: “Seplat Energy delivered a solid performance in the first half of 2024. Continued operational strength positions us well for the second half of the year, which is set to be an active one for the company.
“Reported cash generation was softened by the under-lift in the period, but this is largely a timing effect and our cash generation and balance sheet remain strong.
“In May we received President Bola Ahmed Tinubu for the commissioning of the ANOH gas plant and associated pipelines, and the project remains on track for first gas in 3Q 2024. We thank our government partners for their efforts towards completion of critical pipeline infrastructure in recent weeks.”
Speaking further, he explained that in 2H 2024 the company expects its first gas on the Sapele Plant, which alongside debottlenecking activities at Oben should further enhance gas production, adding: “We are well on our way to increasing gas production in support of Nigeria’s ‘Decade of Gas’
“In our oil business, early results from Sibiri have been modestly ahead of expectations, as well, having completed the first of two planned wells, production at Abiala should commence in the coming weeks and finally we expect higher production at Ohaji once stable operations on the Trans Niger Pipeline are achieved.
“Combined with growth in our gas business and we are looking forward to a strong second half with momentum to carry into 2025. During the quarter a number of important steps were made that support completion of our proposed acquisition of MPNU. We are confident and committed to its completion and continue to work with regulators, government and other parties to ensure its successful completion.”
