SEPLAT Petroleum Development Company issues Interim Management Statement
Seplat Petroleum Development Company plc (“Seplat” or the “Company”), a leading Nigerian
indigenous oil and gas company, listed on both the NSE and LSE, today announces its Interim Management Statement and update on its operations year-to-date 2014.
Key events summary:
– Successful IPO on Nigerian Stock Exchange and London Stock Exchange on 14 April raised $535m at NGN 576 per share (£2.10)
– As disclosed at the time of the IPO, total oil and gas production in the period impacted by 36 days of shut-down of Shell’s Trans Forcados Pipeline (TFP) in Q1, and 7 days of shut-down in April.
– Production has resumed at projected rates and Company remains on track to deliver its 2014 target gross
operated production exit rate of 72,000 bbl/d.
– Seplat’s new pipeline to the Warri refinery now completed and commissioned, creating an alternative liquids
export route to reduce impact of future third-party pipeline and terminal shut-downs.
– Near term drilling programme currently being modified, aiming to accelerate field developments and partially
offset the production deferment caused by the TFP shut-down.
– 15-year Gas Sales Agreement concluded with Azura Edo IPP, to supply 116 mmscf/d at $3/mscf from 2017.
– Ogegere exploration well encountered oil-bearing sands and suspended pending further evaluation.
– Seplat informed by Shell that it is not the preferred bidder for OMLs 29 and 24; assignment of Chevron’s OML 53 to Seplat remains delayed by litigation.
Austin Avuru, CEO of Seplat, commented:
“Completion of our pipeline to the Warri refinery and commencement of crude deliveries to Warri was a strategically important milestone for Seplat. This pipeline provides an alternative export route for our liquids, is under Seplat’s control, and will further reduce the reconciliation losses imposed on our exports via Forcados.
Our gas strategy achieved a major step forward with the signing of the Gas Sales Agreement for the Azura Edo independent power project, at a price of $3/mscf. This contract underpins Seplat’s major investment programme to upgrade the Oben gas plant and expand our domestic gas business.
Our strong bid for OMLs 29 and 24 was not the highest priced offer, and therefore did not lead to our selection as preferred bidder; however we have a substantial pipeline of other material opportunities that are being pursued.
We will retain our focus on acquisition opportunities where we can leverage Seplat’s technical and financial strength, and we will continue to exercise price discipline.
All of our development projects remain on track, and we are confident of delivering our target production exit rate for this year of 72,000 bbl/d, and of recovering as much of the production lost in the period as possible.”