Modupe Gbadeyanka
By Modupe Gbadeyanka
Leading Nigerian indigenous oil and gas company, Seplat, listed on both the Nigerian Stock Exchange (NSE) and the London Stock Exchange (LSE), has announced its full year 2016 financial results and provides and operational update.
In the financial statements, it was disclosed that results were impacted by force majeure at Forcados terminal with net working interest production at 25,877 boepd.
The firm said its revenue for the year suffered a 55 percent loss in 2016 to N63 billion versus N113 billion posted in the corresponding period of 2015.
Also, Seplat realised a gross profit of N16 billion in the period under review compared with N49 billion it made a year earlier, indicating a slump of about 71 percent.
In the same vein, the company’s net profit suffered a huge decline of 352 percent, resulting into a N45 billion loss in 2016 in contrast to N13 billion gain recorded 12 months before.
It was disclosed that during the year, 3 MMbbls gross oil and condensate were exported via Warri refinery route, with the gross exports stabilising at 30,000 bopd during Q2 2017.
There was a completion of the 160,000 bopd Amukpe to Escravos pipeline prioritised by government – anticipated in H2 2017.
The continued growth of the gas business saw 2016 net working interest production up 10 percent year-on-year at 95 MMscfd (210 MMscfd gross) and gas revenue went up 37 percent to $105 million – all gas supplied to domestic market.
Commenting on the results Austin Avuru, Seplat’s Chief Executive Officer, said, “In addition to a difficult global oil market backdrop our business has had to contend with unprecedented operational challenges due to interruptions and these are reflected in our full year results. Whilst force majeure at the Forcados terminal has materially affected our oil production, I am particularly pleased to see the growth in our gas business which in 2016 exceeded the $100 million revenue milestone demonstrating its robustness and providing a solid base from which to grow.
“In addition, we have now established a longer-term alternative export route via the Warri refinery jetty and are nearing completion of upgrade works to the infrastructure enabling a doubling of barging volumes to a steady 30,000 bopd gross during Q2 2017.
“Alongside this, we are collaborating and supporting government on completion of the Amukpe to Escravos pipeline that will offer a third export route through the Escravos terminal. With multiple export routes expected to be operational during the second half of 2017, we will have significantly de-risked our route to market.
“Whilst the quality of our asset base remains undiminished we will continue to maintain strict financial discipline to ensure that we preserve a sufficient liquidity buffer in the current environment and at the same time retain discretion over spend in our portfolio of production opportunities.”
