Seplat Petroleum Development Company has said it has concluded plans to set full year production guidance at the lifting of the force majeure by shell.
Also the company noted that its immediate priority is to increase export via the Warri refinery jetty to a gross average level of 30, 000 barrel of oil per day (bopd) and looking further ahead to support National Petroleum Investment Management Services (NAPIMS) to achieve completion of the new Amukpe to Escravos pipeline.
The company also noted that it would continue to prioritize expansion of its domestic natural gas business which provides a revenue stream that is de-linked from the oil price and underpinned by the strong fundamentals of high demands and increasing price, stressing that eliminating the outstanding NPDC receivables balance remains an absolute priority.
The company which faced a challenging operating environment in 2016 acknowledged the blows dealt its revenue by the extended Trans Forcados shut-in well as volatility in global market.
Chief Executive Officer, Seplat Petroleum Development Company, Austin Avuru while briefing Newsmen at the end of the end of the company’s 2017 Annual General Meeting equally commended the passage of the Petroleum Industry Bill (PIB), adding that it was a step in the right direction, maintaining that the industry is hopeful that the rest of the bills would be passed as soon as possible.
According to him, “the company has established a longer-term alternative export rout via the warri refinery jetty and is nearing completion of upgrade works to the infrastructure enabling a doubling of bargain volumes to a steady 30,000 barrel per day gross during second quarter of 2017.
“Alongside this, we are collaborating and supporting government on completion of the Amukpe to Escravos pipeline that will offer a third export route through the Escravos terminal. With multiple export routes expected to be operational during the second half of 2017, we will have significantly de-risked our route to market.
“Whilst the quality of our asset base remains undiminished, we will continue to maintain strict financial discipline to ensure that we preserve a sufficient liquidity buffer in the current environment and at the same time remain discretion over spend in our portfolio of production opportunities,” he said.
To significantly improve its alternative routes and avoid revenue losses from shut-ins, Seplat is also, in addition to the Warri and Forcados export routes, supporting NAPIMS, a 100 per cent subsidiary of Nigerian National Petroleum Corporation (NNPC).
According to Seplat boss, the company’s gross profit for the year was $72 million, a decrease of 71 per cent on the prior year, adding that this principally reflects the shut-in of the Forcados terminal resulting in lower production, lower oil price realizations and higher costs associated with the alternative export routes to the warri refinery while operating loss for the year was $158 million when compared with a prior year operating profit of $101 million relating to unrealized foreign exchange losses principally on amounts owed by our joint venture partner NPDC.
Also speaking, Chairman of the company. Dr.ABC Orjiako said, “With the diversity of export solutions in place and our increasing gas processing capacity, Seplat has the potential to deliver material production upside with less risk of significant constrains from any infrastructure disruption.
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