Seplat records 12 percent revenue decline despite production increase

Seplat Petroleum Development Company Plc, a Nigerian indigenous oil and gas company listed on both the Nigeria Stock Exchange and London Stock Exchange, recorded a 12 per cent revenue decline from $880 million to $775 million in 2014 despite a quadrupled production jump from about 14,000 barrels per day in 2010 to over 76,000bopd.

However, the company proposed a dividend of $0.15 per share for 2014, up from $0.10 in 2013.

The Chief Financial Officer of the company, Roger Thompson Brown, had projected a conservative net production figure of 32,000 to 36,000bopd for 2015 with the impact of two newly acquired working interest in OML 53 and OML 55.

Speaking at the annual general meeting in Lagos, the Chief Executive Officer, Austin Ojunekwu Avuru, blamed significant outages on the Trans-Forcados system as well as the impact of the reduction of the global oil prices in the second half of 2014 for the decline.

He confirmed that the tax waiver granted the company by the Nigerian government had been fully re-invested in its oil and gas businesses to further spur growth of production and distribution of gas to the domestic market, to contribute meaningfully to the growth and development of the economy.

He noted that not only were the firm properly granted the tax waiver, it showed exemplary behaviour, by utilizing the privilege in a very fruitful manner for the benefit of its stakeholders and the economy at large.

“The pioneer tax advantage was not paid out as dividend to anybody we fully utilized it in reinvestment particularly in our gas business of over US $300m in our gas business and also heavy investments in our oil business which is why we quadrupled production from just about 14,000 barrels in 2010 to the current daily rate of over 70,000 barrels.

“There are benefits to all parties including the government who have had to earn much higher values for royalties and our partners NPDC that have also had to earn much higher total income from our increased production of oil and increased delivery of gas into the domestic market supporting the government’s drive for improved power generation in the country.