• Friday, June 14, 2024
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7 takeaways from Seplat Energy’s 11th AGM

7 takeaways from Seplat Energy’s 11th AGM

Seplat Energy, an indigenous independent energy company listed on both the Nigerian Exchange Limited and the London Stock Exchange, has held its 11th Annual General Meeting (AGM) to transact business with stakeholders.

The virtual event held on May 16, according to the company, marked another year of strategic achievements and set the tone for future growth.

Here are the key takeaways from the meeting:


Last year was a good business year for Seplat Energy in terms of growth as the company delivered a strong set of results in 2023, against a weaker oil price environment.

This is despite the 17 percent decline in the average price of Brent crude, the company grew its oil and gas revenue by 11.5 percent to $1.061 billion, crossing the $1 billion mark for the first time, supported by improved production and asset availability.

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The company also increased average daily production by 8.3 percent in 2023, to 47,758 barrels of oil equivalent per day (boepd), from 44,104 boepd in 2022. While revenue from oil and gas sales for 2023 rose 11.5 percent to $1.061 billion from $952 million in 2022. This excludes the reported $98.9 million overlift.

The company is not shying away from its duty to minimise the impact of operations on the environment as it has plans to create increasingly sustainable energy solutions to provide access and meet increasing energy demand while addressing the critical challenge of climate change for society and the business.

To support these decarbonisation efforts, Seplat Energy has committed $5.7 million towards projects to end routine flares in operations. This includes installing gas compression facilities and incineration at various flow stations.

Speaking at the AGM, Udoma Udo Udoma, the new Chairman of the Board, said the company remained committed to pursuing strategic aims in the most sustainable way possible, for the benefit of all stakeholders and shareholders.

He said, “We intend to commence production from our joint venture ANOH Gas Processing Company and, we hope to complete our transformative acquisition of Mobil Producing Nigeria Unlimited (MPNU), which will diversify the business into offshore operations for the first time.

“We have been able to take on this acquisition alongside other strategic business decisions due to our focus on high standards of safety, responsible stewardship of Nigeria’s assets, excellence in operations, improvements in corporate governance, and consistent strengthening of our finances.”

Rewarding Shareholders

For the fiscal year 2023, the Board recommended a total dividend of 15 cents per share to shareholders. This decision was influenced by various considerations, as the company has a solid financial plan that assures it can operate effectively.

Eleanor Adaralegbe, Chief Financial Officer of Seplat, said: “The Seplat Energy Board recommended a special dividend of US 3 cents per share for the 2023 business year aside from the core dividend of US 12 cents per share, up 20 percent on 2022.

“The payment of the special dividend reflects the board’s continued confidence in the future of the business and is underpinned by a strong balance sheet.

“Our financial strategy ensures we can appropriately fund our capital expenditures, meet necessary debt repayments, and return cash to our shareholders. It also provides the flexibility required to realise the value of our asset base.”


Though the proposed acquisition of MPNU started about two years ago, Udoma said the board remains confident that the transaction will be approved, and all associated legal issues will be resolved.

“We continue to work with all parties to achieve a successful outcome, including our financiers, who remain supportive. We have been encouraged by the continued efforts of President Tinubu’s administration to drive positive change in Nigeria and a more supportive environment for businesses that want to invest and grow in the country.

“We hope to complete our acquisition of the entire share capital of MPNU and integrate its business with ours, welcoming its highly skilled and experienced staff to the Seplat family”

Explaining further, Roger Brown, Managing Director of the company, said the ANOH gas plant achieved mechanical completion on December 29, 2023, without recording any Lost Time Incident (LTI) across 11 million hours.

He added that current activity on the ANOH gas project involves moving all key work streams to completion ahead of the first gas, planned for Q3 2024.

He said, “All upstream wells required for first gas were completed by the operator, SPDC, in 2023, with well deliverability tests conducted in Q1 2024. Work is ongoing to connect the wells to the gas plant.

“Our government partner, NNPC Gas Infrastructure Company (NGIC), is responsible for delivering the pipelines required to transport the gas from ANOH to the demand centres, including the 23km spur line and the Obiafu-Obrikom-Oben (OB3) pipeline.

“With respect to the OB3 pipeline, grouting of the unconsolidated formation along the tunnelling pathway on the River Niger has been completed, and our government partners announced that tunnelling operations are ongoing. Our partners recently reaffirmed their guidance for the completion of construction of the OB3 pipeline in Q2 2024.

Read also: Seplat: Weak topline, higher tax expense drive Q1 loss

“Regarding the Spur Line project, the operations in Imo State are witnessing improved progress following the engagement of additional contractors to expedite the completion of the remaining pipeline sections. NGIC is advising an expected completion date of the end of Q2 2024.

“The project has achieved several notable milestones in recent months, providing greater assurance that the project is on track to achieve first gas as estimated by Seplat in Q3 2024. Upon commencement of operations, ANOH will provide two income streams to Seplat.

“First, the sales of wet gas from Upstream to AGPC. The ANOH gas plant has a design capacity of 300 mmscf/d. As a 50 percent owner in the AGPC-incorporated joint venture, Seplat will receive dividends from the AGPC’s profits.”

New energy business

In line with its strategy to lead in energy transition, Seplat has assessed various midstream gas, power, and renewable investment opportunities that are focused on increasing energy supply and reliability, lowering costs, and reducing carbon intensity of Nigeria’s electricity consumption.

“In view of this, we have high-graded a gas-to-power development project, which should be matured during 2024 and presented to the Board for approval.

In addition, following the completion of internal due diligence, Seplat is reviewing two other potential acquisition opportunities in the Compressed Natural Gas (CNG) and Renewable Power Generation markets,” Brown said.

Safety Culture

Seplat Energy demonstrated its strong safety culture in the year under review with a total of 8.7 million hours without any LTI. To date, the company has achieved a cumulative 10.6 million man hours since the last LTI recorded in October 2022.

Samson Ezugworie, Chief Operating Officer of Seplat, said, “Safety remains Seplat Energy’s top priority. Several training sessions on Incident Management, Process Safety Management Training for Operations, Engineering, Maintenance, Wells, and HSE Team members were conducted over the past year to ensure all teams are updated on the latest safety procedures.

“The company is also on a path to achieving ISO 45001 and 14001 standards certifications, demonstrating its commitment to top-tier safety and environmental performance.

“These certifications are globally acknowledged benchmarks for occupational health and safety management systems and environmental management systems, respectively.”

Commitment to Host Communities

Seplat has several initiatives in place to support communities, including health, and educational programs. It also engages in continuous dialogue with community members starting from project initiation and throughout the operation and decommissioning phases.

Samson Ezugworie, the COO of Seplat, said, “In 2023, we made substantial progress by installing solar panels and granting 100 percent renewable energy access to five schools and three hospitals, advancing our goal of increasing energy access while enhancing our capabilities in the power and renewable energy sectors.

“In 2024, we plan to provide additional community hospitals, schools, and households with reliable and renewable power. We executed successful direct intervention programs in health and education as well in our communities, and these initiatives underscore our commitment to social responsibility and creating long-term value for all stakeholders.”

Going Forward

Brown said that the company’s 2024 capex programme aims to maintain production, and we provided initial guidance at 44 – 52 kboepd with Q1 2024 average production was 49kboepd.

The guidance assumes the availability of the Trans-Niger Pipeline (TNP) from the end of 3Q 2024. It also assumes the first gas on ANOH in line with guidance, and a gradual ramp-up of contribution from the gas field through the end of the year.

“Capital expenditure for 2024 is expected to be in the range of $170-$200 million. The programme includes drilling 13 new wells across our operated and non-operated assets, as follows: OMLs 4, 38 & 41 – Nine wells (seven oil wells, two gas wells); OML 40 – Four oil wells (including two wells in Abiala).

“The 2024 drilling program will address normal production decline and, along with the completion of maintenance activities, support long-term production levels from the assets.

Read also: ANOH gas project can provide electricity for five million homes- Seplat Energy

“Our key focus areas and expenditure on the facility and project deliverables include the completion of the ANOH Gas Processing Plant commissioning and commencement of operations; Completion of the Sapele Gas Plant; and Installation of Abiala surface production facilities.

“Additionally, we are committed to exploring and developing new business opportunities, especially along our New Energy business, fostering growth and diversification within our portfolio.”

Seplat Energy was one of the early adopters of the IFRS S1 & S2 Disclosure Standards and commenced reporting in alignment with these standards from the 2023 annual report.