Financial Energy Review
Seplat Energy Plc, a leading Nigerian independent energy company listed on both the Nigerian Exchange Limited and the London Stock Exchange, has within a year experienced a 10.2 per cent gas revenue, reaching $63.7 million in 6M 2023 (compared to $57.8 million in 6M 2022).
This growth is attributed to increased realised gas prices and a rise in sales volume. The average realised gas price rose by 4.4% to $2.87/Mscf, while gas production saw a moderate 1.4 per cent increase to 21.6 Bscf during the same period (compared to 21.3 Bscf in 6M 2022).
The average realised gas price improvement reflects the impact of upward gas price revisions implemented in the period, Seplat Energy said in a recent breakdown on performance for its business operations.
In its outlook for the remaining part of the year, Seplat Energy said: “Our group production performance has improved in 2023, thanks to greater uptime on OML40 and reduced losses on our Western Asset.
“We maintain our 2023 guidance range at 45,000-55,000 boepd, which we are confident of meeting, given year to date production and the expected benefit of new well stock as it becomes available in the latter part of the year.
“We stress that our guidance does not include any expected contribution from Mobil Producing Nigeria Unlimited (MPNU) or ANOH projects. Our capital expenditure guidance for 2023 is adjusted to a range of $160-190 million. Our commitment to meeting the planned drilling targets remains steadfast, and we have a drilling plan in place to meet these targets in 2H 2023.”
Financial Energy Review learnt it was during this period that Seplat Energy’s average working interest gas volumes reached 119.4 million standard cubic feet per day (MMscfd), showing improvement compared to 117.7 MMscfd in the first half of 2022. This increase can be attributed to enhanced well performance and the availability of condensate evacuation routes.
The company added: “We have successfully entered into a new Gas Sales Agreement (GSA) with a bulk gas supplier for a volume of 50 MMscfd. Once all the necessary Conditions Precedent are met by the new customer, we will commence gas supply under this agreement. The execution of additional GSAs is part of our strategy to optimise the capacity of the Oben gas plant.
“We are also actively working on securing third-party gas to feed both the Oben and Sapele gas plants.
“The execution of the plan for separating the midstream business from the upstream operations has progressed according to schedule. We have completed the internal transfer of midstream assets to Seplat Midstream Company (SMC). Additionally, we have issued notices to our joint venture partners and relevant regulators to inform them of these developments. We will continue to keep the market updated on the progress of this separation process.”
During the period, five wells in Seplat Energy’sdrilling program were delivered: Opuama-17, Sibiri-2, Gbetiokun 4 workover, Gbetiokun[1]10, and Assa North-05. In the first quarter of the year, Opuama-17, was completed and is producing at a gross rate of c. 3,000 bopd.
Sibiri-2 well has been drilled to TD, with the target reservoirs completed; and the company currently awaiting regulatory approval to commence production from the well. GB-10 well has been drilled and completed ahead of the target date and is expected to add c.1,300 bopd to production upon completion of flowline installation and well head construction. Lastly, GB-4 W/O will add c. 2,200 bopd to production.
