Seplat’s shares have jumped 4.6 percent to N900 per share today as investors take position amid rallying oil prices and the company’s acquisition of ExxonMobil’s offshore shallow water assets for $1.2 billion.
Prior to the announcement on Friday morning, the leading energy company’s shares had recorded gains in its share prices, triggered by the Ukraine-Russia conflict which has caused a surge in global oil prices.
Seplat stock closed 7.49 percent higher on Thursday at N859.9 per share.
Speaking on the acquisition, Temitope Omosuyi, Investment Strategy Analyst, Afrinvest Limited said this could be a strategy to improve its production capacity to benefit from the rallying oil prices.
Yesterday, Brent oil surged to $105.79 a barrel, the highest level since August 2014.
“The bullish sentiment will continue, investors are now looking for all opportunities to invest in oil whether directly, through its derivative or through a company like Seplat,” Omosuyi said.
Read also: Seplat buys ExxonMobil’s Nigerian shallow water assets for $1.2bn
The Transaction will create one of the largest independent energy companies on both the Nigerian and London Stock Exchanges, and bolster Seplat Energy’s ability to drive increased growth, profitability and overall stakeholder prosperity.
According to a press release by the company, the transaction will deliver 186 percent increase in production from 51 kboepd to 146 kboepd and a 170 percent increase in 2P liquids reserves, from 241 MMbbl to 650 MMbbl.
According to FBNQuest, Seplat’s shares are up 31 percent year to date (YTD), outperforming the Nigerian Exchange Group (NGX) All Share Index (ASI) which has gained 11 percent YTD.
The company posted a profit of N14 billion in the first nine months of 2021 compared to a full year loss of N31 billion in 2020.
Its revenue also surged 18.7 percent to N182.7 billion in the first nine months of 2021.
