Seplat Energy Profit Grows N48bn, Awaits Approval To Acquire Mobil Producing

Seplat Energy said is awaiting regulatory approval on the acquisition of Mobil Producing Nigeria Unlimited to bring the transaction to closure by the second half of 2022.

Seplat Energy, a leading Nigerian company listed on both the Nigerian Exchange Limited and the London Stock Exchange announced in February that it has entered into a Sale and Purchase Agreement to acquire the entire share capital of MPNU for a purchase price of $1,283 million-plus up to $300 million contingent consideration, subject to the lockbox, working capital and other adjustments at closing relative to the effective date.

The Chief Executive Officer, Seplat Energy Roger Brown who announced today while announcing the company’s first-quarter results stated, “Our proposed acquisition of MPNU remains on course. We are awaiting the necessary approvals from government and regulators and expect the transaction to complete in the second half of this year” stating that the 1 January 2021 effective day means it will benefit from higher recent oil prices.

Brown who also announced that Seplat Energy’s revenue has grown to N100.6 billion at the end of the first quarter of 2022 which indicates a 58.6 growth, said the addition of MPNU will nearly treble its production and double its reserves on a pro forma 2020 basis.

“The acquisition will reinforce our leadership of Nigeria’s indigenous energy sector and enable us to generate strong future cash flows that will underpin our investment in Nigeria’s energy transition and improve our overall stakeholder returns”.

He also stated that it would bring 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.

“We announce the decision to divest the Group’s interest in the Ubima marginal field for a consideration of $55million, which marginally reduces the company’s 2P reserves by 2 MMboe to 455 MMboe.

“We have proven we have the financial strength and credibility to attract international finance into Nigeria’s energy sector and this will help us in our aim to deliver energy transition and provide cleaner, more reliable and more affordable energy for Nigeria’s young and growing population.”

Meanwhile, Seplat Energy has announced N74.4 billion cash generation from its operations in the first quarter of 2022 as against N1.7 billion in the corresponding period in 2021 while its gross profit has hit N48.8 billion, rising by 122.3 per cent.

In the results announced Thursday, the Energy company declared a strong safety record, which extended to 26.1 million hours without LTI from operated assets (2.0 million hours in Q1 2022).

The energy company also announced that it grew its revenue by 58.6 per cent to N100.6bn from N57.9 billion year on year; while its gross profit soars to N48.8 billion from N20.1 billion year-on-year, rising by 122.3 per cent.

In the first three months of the year, Seplat Energy demonstrated a strong safety record, which extended to 26.1 million hours without LTI from operated assets (2.0 million hours in Q1 2022).

Its operational and financial highlights show that its working interest production averaged 47,603 boepd (liquids 29,079 bopd, gas 18,524 boepd) while its Full-year guidance remains unchanged at 50-60 kboepdA

The energy firm also disclosed that it has mechanically completed Amukpe-Escravos Pipeline while all commercial terms have been agreed upon and are moving through counterparty approval processes for signature. on a deal that is expected to be fully operational by end of Q2 2022.

Also, the Sibiri exploration is successful with data analysis underway, and currently working with partners to secure regulatory approval for the Extended Well Test.

Following the impressive performance that has seen its revenue up by 58.6 per cent to $241.8 million and EBITDA up 81.6 per cent to $147.4 million (adjusted for non-cash items) and a strong balance sheet with $312.2 million cash at the bank, net debt of $442.6 million, the company has declared $2.5 per share initial interim dividend.

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