Seplat Energy Share Discussion Threads

[whiskeyinthejar] 12/4/2016 09:32

I think it's Lekoil that have interest in opl241. Offshore field I think.

Seplat is onshore. Lower operational costs and gas fields close to where it's needed.

Operations;


Not much interest in Seplat in uk, bit dead here. But it's listed in Nigeria, bit more interest there.

[tim duggan] 12/4/2016 09:01

Whiskey in the jar..is the consortium asset opl241?

[whiskeyinthejar] 12/4/2016 08:53

Seplat's projections for 2016
11 Apr 2016, 12:00 am
Financial Nigeria
Seplat's projections for 2016
Feature Highlight

Seplat has forecast a 5 percent growth in revenues to N119.8 billion ($599 million).

Seplat Petroleum Development Company recently held its full-year 2015 analyst/investor conference call in which the company said it expects a much better performance in 2016 as production volume increases, particularly from its gas business. Low oil prices, which have declined by more than 60 percent since July 2014, as well as significant downtime at Seplat's Trans Forcados pipeline, impacted the company's revenues in 2015.

Seplat, a leading Nigerian oil and gas exploration and production company, released its 2015 audited report and financial statements last month, showing 26.4 percent year-on-year (YoY) decline in revenue from N124 billion ($775 million) in 2014 to N113 billion ($570.5 million) last year. The company's profit before tax (PBT) fell 65.5 percent YoY to N17 billion ($87 million) compared with N40 billion ($252 million) in 2014.

The downbeat results masked the company's strong production last year as its average daily oil production rose 29 percent from 30,823 barrel of oil equivalent per day (boepd) in 2014 to 43,372 boepd last year. In its projection for 2016, Seplat has informed investors that it anticipates net production to rise by 9 percent YoY to 47,000 boepd. This projection is within the management’s production guidance of 41,000 boepd to 48,000 boepd for this year.

With the inclusion of its new assets -- OML 53 and OML 55 -- which the company acquired from Chevron Nigeria following a Supreme Court judgement in January, Seplat has forecast a 5 percent growth in revenues to N119.8 billion ($599 million).

Seplat's management has proposed N26 billion ($130 million) for capital expenditure in 2016, down from N30.4 billion ($152 million) and N64.2 billion ($321 million) in 2015 and 2014, respectively. The lower CAPEX spend this year and anticipated profit after tax (PAT) of around N16.2 billion ($81 million) are due to the uncertainty over the renewal of the tax holiday Seplat was given by the Nigerian government in the last three years. The Nigerian Investment Promotion Council (NIPC) is yet to approve the firm's pioneer status, even though it is renewable for another two years. Seplat said the exemption from tax payment enabled it to ramp up capital projects during the period (2012-2015).

The company invested over N60 billion ($300 million) in gas projects over the last two years. Seplat has a strategy to become a preeminent supplier of natural gas in the Nigerian domestic power sector. Seplat’s investments have raised gross gas production from an average of 90 million standard cubic feet of gas per day (mmscfd) in 2012 to around over 300 mmscfd in 2015. The firm has signed gas supply contract agreements with several power projects in Nigeria including Azura Power, Sapela Power Plant, Geregu Power Plant and Nigerian Gas Company.

CardinalStone Partners Limited, a Lagos-based financial advisory and investment management firm, said extended shut-downs at Seplat's Trans Forcados Terminal could negatively impact production guidance since the terminal is crucial to evacuation from key oil fields.

The asset management firm has increased the Target Price (TP) for Seplat's stock to N376.38, from the previous TP of N312.79. CardinalStone has also issued a Buy recommendation -- a rating given to equities with strong fundamentals -- for Seplat’s stock, which is listed on the Lagos and London stock exchanges. Seplat's share price, according to CardinalStone, is tied to the flux in oil prices. Its stock would perform better if oil prices rebound while a weaker than expected oil price environment would put downward pressure on the price.

[whiskeyinthejar] 01/4/2016 15:38

Seplat among bidders to build new oil refineries:

[dukedosh] 23/2/2016 12:23

Shell declares force majeure on Forcados oil export

By Sulaimon Salau on February 23, 2016 12:41 am

SHELL Petroleum Development Company of Nigeria Limited (SPDC) yesterday said it had declared force majeure on Forcados oil export following disruption in production caused by the spill on the subsea crude export pipeline.

The Media Relations Manager, SPDC, Precious Okolobo, who confirmed this yesterday, said the force majeure was effective 1500hrs (Nigerian time) February 21, 2016.

Meanwhile, he said the SPDC is intensifying efforts on containment and oil recovery while also finalising repair plans.

Although he did not state the quantity of the oil shut-in, but Forcados terminal is one of Nigeria’s biggest terminals with capacity to export 400,000 barrels a day.

The oil recovery, according to Okolobo, is supported by industry group Clean Nigeria Associates (CNA) and other oil companies, adding that Shell has deployed specialised equipment to contain the spill.

SPDC, he said, has also mobilised clean-up teams and contracted a specialised aircraft to join in the response. Production into the terminal and crude oil exports were stopped soon after the spill was discovered.

[coxsmn] 04/2/2016 19:35

hxxp://bloom.bg/1P9h8wn

[dukedosh] 01/2/2016 18:08

Broker's note from RBC Friday:

Seplat gains control of OML 53 and OML 55

January 29, 2016 12:50 pm ET

Late today, Seplat Petroleum Development announced that the Supreme Court of Nigeria had delivered its judgement in favour of Seplat and Chevron Nigeria Limited (CNL) in a litigation brought against both parties by Brittania-U Nigeria Limited that had to date prevented the full transfer to Seplat of a 40% working interest in OML 53 and effective 22.5% working interest in OML 55 (held through 56.25% ownership of the share capital of Belemaoil Producing Limited) that the company had acquired from CNL in February 2015.

Our view: The decision is welcome as it enables Seplat to target the gas on OML 53 and further diversify its production stream; gas prices in Nigeria are not linked to oil prices – domestic supply obligation (DSO) volumes are $2.5/Mcf, and under willing buyer/willing seller commercial contracts pricing have improved to $3.5/Mcf+. OML 53 fits neatly within the company’s strategy of commercialising and monetising natural gas in the Niger Delta, to supply the rapidly growing domestic market. OML 55 also includes some opportunities to generate near-term production growth, cash-flow and reserve replacement in the onshore and shallow water areas, but these are unlikely to be a near-term priority while oil is trading at ~$35/bbl, in our view.

Acquisitions: Back on 5th February 2015, Seplat announced that it had acquired a 40% working interest in OML 53 and an effective stake of 22.5% in OML 55 from CNL. The deals were concluded – Seplat’s current balance sheet (YE15 gross debt of $863m and cash of $326m (as updated earlier this week)) already reflects the impact of the acquisitions, except for some minor working capital adjustments. However, the company was unable to access and direct operations due to the court injunction.

Assets: OML 53 covers an area of ~1,600km2 and is located onshore in the north eastern Niger Delta. The block contains the large undeveloped Ohaji South gas and condensate field, which is planned to be developed in conjunction with Shell’s Assa North field on OML 21 - the ANOS project. The block also encompasses the Jisike oil field, which is currently the only producing field on OML 53. Gross production from Jisike in 2015 averaged 1,715b/d (686 b/d net). The company estimates net recoverable hydrocarbon volumes attributable to its 40% working interest to be ~600Bcf gas and 50mmbbl of oil and condensate. OML 55 covers an area of approximately 840km2 and is located in the swamp to shallow water offshore areas in the south eastern Niger Delta. The block contains five producing fields (Robertkiri, Inda, Belema North, Idama and Jokka). Gross production from OML 55 in 2015 averaged 7,746b/d (1,743b/d net). The company estimates net recoverable hydrocarbon volumes attributable to its 22.5% effective working interest to be ~20mmbbl of oil and condensate and ~160Bcf of gas.

Outperform
Speculative Risk
TP 115.00

[dukedosh] 31/1/2016 14:43

IIRC the acquisition was completed back in Feb 2015 but with possible further deferred payments should POO rise above $90 bbl. Let's hope we have to make those further payments this year!

SEPL have literally just taken over the ex CNL blocks as operator. It would be reasonable to expect some guidance and ops update over the coming weeks.

The NPDC money would be a bonus but Nigeria is a busted flush with $30 oil.

[krall] 30/1/2016 21:27

dukedosh - good info on the court ruling.

a few questions you maybe can answer. Im very much aware of the long term potential of the blocks acquired from Chevron, now with the deal closed, are there any short term triggers and gains, maybe some interesting newsflow?

Is everything around the payment for the blocks done?

I´ve always thought this is a very interesting company and is probably a very good long hold, the oily part of the company is the most dynamic, but i think key to success in Nigeria and working with NNPC/NPDC will be to continue expand and increase the domestic gas sales.

Lets hope the deal set up to get money back from NPDC really works.

"Pursuant to the agreement signed in July 2015, the Company continues to offset NPDC's 55% share of gas revenues from OMLs 4, 38 and 41 against the outstanding NPDC receivables balance which stood at approximately US$449 million (net) as at 31 December 2015. Furthermore, NPDC and Seplat are working through the final approvals process to implement a forward sale of a portion of joint venture oil production that will retire some of the outstanding NPDC receivables balance and fund joint venture cash calls going forward."

The outstanding sum is shrinking but mayby not in a very fast pace.

"The outstanding NPDC net receivable as at 30 September was US$461 million, down from US$504 million at mid-year, the reduction coming primarily as a result of the agreement signed between Seplat and NPDC in July whereby gas revenues attributable to NPDC's interest in OMLs 4, 38 and 41 are offset against the balance of arrears. Pursuant to the agreement NPDC and Seplat are also engaged with potential counterparties to provide joint venture loan facilities of up to US$300 million to fund cash calls with effect from January and further accelerate repayment of arrears".

[dukedosh] 29/1/2016 16:29

OML 53 and OML 55
At last they put out the RNS, only 4 hours after their Tweets!

[dukedosh] 29/1/2016 16:10

SP just marked up. I think they must have read your post WITJ. ;-))

[whiskeyinthejar] 29/1/2016 15:37

I don't think currency exchange fluctuations explain a rise from 152 to 194 in only a week!

Shareprice has risen almost 30% in Nigeria in one week.

[dukedosh] 29/1/2016 15:11

The Naira to GBP currency weakness either killed the share price rise here or caused the share price rise in Nigeria. It's probably the later.

[whiskeyinthejar] 29/1/2016 15:02

Nice find.

Share price in London seems to be lagging quite a bit compared to Nigeria over last week. Reaction to update was very positive and the other day it rose 8% in one day.

Anyway, seems it closed at 151.7 on 21st Jan. Now trading at 194.25 in Nigeria.

[dukedosh] 29/1/2016 12:49

These Tweets from SEPL a few moments ago.

Seplat Petroleum Dev ‏@SEPLATPetroleum 18m18 minutes ago
@Seplatpetroleum Wins!!!!
Brittania-U loses case against Seplat/Chevron.

Seplat Petroleum Dev ‏@SEPLATPetroleum 14m14 minutes ago
Handover of the assets from Chevron’s CEO to SEPLAT’s CEO at the Chevron office.



These guys didn't waste any time!

[keith95] 28/1/2016 02:35

Check out MX Oil (MXO) received a good offer for its Nigerian assets .. shares went up 100% + small cap so pretty meaningless in that sense - but the point being that consolidation is happening and oil will turn at some point ....


I cleared out at 72p .. and bought back in at 60p ... which was a wise move with hindsight .. but this share will recover back to 100+ or go bust ...

I'm betting on the former before the latter with good divis in between.

[whiskeyinthejar] 27/1/2016 10:13

Well. entire market is based on guesswork. Thousands of oil experts, broker analysts, journalists make a mint guessing.

That's seemingly rather more wasteful because nobody knows the future. But markets run on guessing the future, not the past. It's why they are irrational and based more on sentiment than facts.

But anyway a discussion is never futile given the effort, because you don't know where it'll lead.

The only problem imo with this thread is a shortage of interest. Id much prefer some sort of guessing going on here to thread being just dead.

[dukedosh] 27/1/2016 03:34

Company will announce 2016 guidance in March. It would be futile to attempt any forecast before we know these numbers.

[whiskeyinthejar] 26/1/2016 22:08

I don't know mate. Your guess is as good as mine. Probably better as I have an optimistic bias. And Duke Dosh definitely knows Seplat better than me.

I found the analysts note on twitter by the way, posted by Vetiva themselves. I don't know their reputation.

Vetiva calculate that Seplat will make same profit this year if poo averages $45. With the $45 hedge in place for some production anyway in H1, maybe this is reasonable?

Obviously they have lotta cash in bank so they could afford to pay out more than $86m.

But I don't know how critical they think it is to hold that war chest in case low oil persists? Or whether they want to make an asset purchase? I think they should make a deal with NNDPC over the receivables to pick up an asset. They don't need to decide on divi for some months anyway.

But let's say they decide to pay out $86m. FWIW I calculate $86m/563m shares =15.37cents. Dividend last year 9 +4 =13 cents.

So what do you think. It does seem they can afford to maintain dividend? All depends on poo doesn't it?

[coxsmn] 26/1/2016 19:14

Whisky, thanks for your informative posts. Have you any thoughts on size of dividends payments this year?

[whiskeyinthejar] 26/1/2016 12:12

Analysts at Vetiva have issue a note. It's a pdf.

They are forecasting profit of $86m for 2015, compared to profit of $252m in 2014.

[whiskeyinthejar] 25/1/2016 22:41

Yeah cash plus receivables is greater than debt. Although the high receivables makes investors nervous imo because Nigeria is skint, but they seem to have a plan.

There's been a lot of problems with attacks on the TransForcados export route of course. Update says if it hadn't been for downtime on TransForcados, production in 2015 would have been 47k boepd. But now they have two completed storage tanks to use if there's any TransForcados downtime, so that's a big win I think.

But production is now up at 55,000 boepd. That's pretty good with capex cuts etc.

Revenue is down 23% year on year. Seems bad but Shell iirc has revenue down 36%. Shell is a bad comparison I know but best I can do. Lol.

The other good news imo is that they seem to be making lucrative commercial contracts says "pricing continues to improve to levels of US$3.5/Mscf and above." Short on details though.

[coxsmn] 25/1/2016 20:58

Don't forget they have a receivables balance of US$449.

"Pursuant to the agreement signed in July 2015, the Company continues to offset NPDC's 55% share of gas revenues from OMLs 4, 38 and 41 against the outstanding NPDC receivables balance which stood at approximately US$449 million (net) as at 31 December 2015. Furthermore, NPDC and Seplat are working through the final approvals process to implement a forward sale of a portion of joint venture oil production that will retire some of the outstanding NPDC receivables balance and fund joint venture cash calls going forward."