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Seplat Petroleum Development Co PLC 2020 Annual Report and Notice of AGM

14/04/2021 7:00am

UK Regulatory (RNS & others)


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RNS Number : 4186V

Seplat Petroleum Development Co PLC

14 April 2021

14 April 2021

Seplat Petroleum Development Company Plc

2020 Annual Report and Notice of AGM

Seplat Petroleum Development Company Plc ("Seplat" or the "Company") confirms it has today published its Annual Report and Accounts for the year ended 31 December 2020 together with the notice of the Company's eight Annual General Meeting ("AGM") and forms of proxy. The Company will hold its AGM at 11:00am (local time) on Thursday 20 May 2021 at 16a Temple Road (Olu Holloway), Ikoyi, Lagos, Nigeria.

In accordance with Listing Rule 14.3.6 copies of the Company's Annual Report and Accounts for the year ended 31 December 2020, the Notice of AGM and proxy forms have also been submitted to the FCA for publication through the document viewing facility of the National Storage Mechanism and will shortly be available for inspection at http:// www.morningstar.co.uk/uk/NSM

In accordance with Disclosure Guidance and Transparency Rule ("DTR") 6.3.5R(3), copies are available on the Company's website, www.seplatpetroleum.com

The Company's audited financial statements and extracts of the management report, were included in the Company's Final Results announcement on 1 March 2021. That information, together with the Appendices to this announcement, which contains the following additional information that has been extracted from the 2020 Annual Report, constitutes the material required for the purposes of compliance with DTR 6.3.5 only:

   --                   the Directors' Responsibilities Statement; 
   --                   a description of principal risks and uncertainties that the Company faces; and 
   --                   related party transactions. 

This announcement should be read in conjunction with and is not a substitute for reading the full 2020 Annual Report. Page and note references in the text below refer to page numbers and notes in the 2020 Annual Report and terms defined in that document have the same meanings in these extracts.

Enquiries

 
 Seplat Petroleum Development Company plc 
 Emeka Onwuka, CFO                              +234 (0) 1 277 0400 
 Edith Onwuchekwa, Company Secretary/General 
  Counsel 
 Carl Franklin, Head of Investor Relations 
 Ayeesha Aliyu, Investor Relations 
 Chioma Nwachuku, GM - External Affairs 
  and Communications 
 
 FTI Consulting 
 Ben Brewerton / Sara Powell                    +44 (0) 203 727 1000 
                                                seplat@fticonsulting.com 
 
 

Notes to editors

Seplat Petroleum Development Company Plc is a leading indigenous Nigerian energy company with a strategic focus on Nigeria, listed on the Main Market of the London Stock Exchange ("LSE") (LSE:SEPL) and Nigerian Stock Exchange ("NSE") (NSE:SEPLAT).

Seplat is pursuing a Nigeria focused growth strategy and is well-positioned to participate in future divestment programmes by the international oil companies, farm-in opportunities and future licensing rounds. For further information please refer to the company website, http://seplatpetroleum.com/

Appendices

Appendix A: Statement of Directors' responsibilities

The following Statement of Directors' responsibilities is extracted from the 2020 Annual Report and Accounts (page 142).

The Companies and Allied Matters Act, 2020, requires the Directors to prepare financial statements for each financial year that gives a true and fair view of the state of financial affairs of the Group at the end of the year and of its profit or loss. The responsibilities include ensuring that the Group:

1. keeps proper accounting records that disclose, with reasonable accuracy, the financial position of the Group and comply with the requirements of the Companies and Allied Matters Act, 2020;

2. establishes adequate internal controls to safeguard its assets and to prevent and detect fraud and other irregularities; and

3. prepares its financial statements using suitable accounting policies supported by reasonable and prudent judgements and estimates and are consistently applied.

The Directors accept responsibility for the annual financial statements, which have been prepared using appropriate accounting policies supported by reasonable and prudent judgements and estimates, in conformity with International Financial Reporting Standards (IFRS), the requirements of the Companies and Allied Matters Act, 2020 and Financial Reporting Council of Nigeria Act, No. 6, 2011.

The Directors are of the opinion that the financial statements gives a true and fair view of the state of the financial affairs of the Group and of its financial performance and cash flows for the year. The Directors further accept responsibility for the maintenance of accounting records that may be relied upon in the preparation of financial statements, as well as adequate systems of internal financial control.

Nothing has come to the attention of the Directors to indicate that the Group will not remain a going concern for at least 12 months from the date of this statement.

Signed on behalf of the Directors by:

   A.B.C Orjiako                                                                          R.T. Brown 

Chairman Chief Executive Officer

   FRC/2014/IODN/00000003161                                           FRC/2014/ ANAN/00000017939 
   1 March 2021                                                                         1 March 2021 

Appendix B: Principal risks and uncertainties

The following principal risks and uncertainties table is extracted from the 2020 Annual Report and Accounts (pages 30 to 36).

The implementation of our strategy can be hindered by various risks and uncertainties. The risks that the Board considers most significant are described here.

 
 Operational risks 
 Field operations and            Third-party infrastructure       HSSE risks 
  project deliverability          downtime 
                                -------------------------------  ------------------------------ 
 Description                     Description                      Description 
  Failure to manage               An over-reliance                 Oil and gas activities 
  operational activities          on third-party operated          carry significant 
  in line with planned            transportation infrastructure    levels of HSSE risks 
  expectations can lead           can expose the Company           if not properly managed. 
  to production misses,           to an extended period            As activity levels 
  project delays and              of production being              continue to increase 
  cost overruns, high             shut in.                         there is a strong 
  production costs and                                             focus on preventing 
  earlier than expected                                            major environmental 
  field decommissioning.                                           (including the emerging 
  Risk also expanded                                               climate change - GHG 
  to cover the emerging                                            emissions risk), health 
  OPEC quota restriction                                           or safety incidents. 
  risk on production, 
  resulting in production 
  shut-ins. 
                                -------------------------------  ------------------------------ 
 Mitigation                      Mitigation                       Mitigation 
  Focus on risk management        Work is ongoing to               Deployment of an 
  at planning phase               secure a second export           HSSE Management System 
  and mitigation plans            line to complement               in line with best 
  activated. Compulsory           the Trans Forcados               practices. Monitoring 
  'peer-to-peer' review           Pipeline. Continue               and reporting of HSSE 
  for high-value projects         to explore export                performance scorecards 
  and better project              via barging as a back-up         at management and 
  management techniques.          option in extreme                Board levels. Our 
  Protracted land acquisition,    cases. Have two contingency      HSSE systems and process 
  preparation and rig             tanks in Amukpe for              are subjected to independent 
  startup have been               partial storage during           review and identified 
  contributory factors            shut-in over shorter             improvement initiatives 
  which have received             periods. More tanks              are deployed. Continual 
  focused attention               are planned. Additional          focus on HSSE training 
  and significant process         plans to scope FEED/DED          and initiatives on 
  improvements and improved       of a new export line             incidence prevention. 
  communications with             in the coming year               Emergency Response 
  JV partner and approving        2021.                            plan set for any eventuality 
  regulators to mitigate                                           and comprehensive 
  delays. Use of smart/                                            Incident Review panels 
  intelligent wells                                                to identify and channel 
  to improve recovery                                              lessons learnt to 
  and improved rig performance                                     improvement activities. 
  monitoring and reporting                                         Focus on the delivery 
  to manage NPTs.                                                  on projects earmarked 
                                                                   to reduce and or eliminate 
                                                                   gas flaring as spelt 
                                                                   out under the Company's 
                                                                   'gas flares out roadmap'. 
                                -------------------------------  ------------------------------ 
 KPI/Performance metric          KPI/Performance metric           KPI/Performance metric 
  Net working interest            Net working interest             HSSE scorecards 
  production                      production                       LTIF 
  Operating costs per             Days downtime                    TRIR 
  boe                             EBIT 
                                -------------------------------  ------------------------------ 
 Strategic pillars               Strategic pillars                Strategic pillars 
  1, 2, 3                         2, 3                             2, 3, 5 
                                -------------------------------  ------------------------------ 
 Assessment                      Assessment                       Assessment 
  Very high                       Very high                        High 
                                -------------------------------  ------------------------------ 
 Trend                           Trend                            Trend 
  Steady. We continue             Steady. Remarkably               Steady. Though the 
  to refine our project           improved uptime of               risk is inherent, 
  management approach             Forcados export system.          we will continue to 
  for improved speed              However, risk trend              deploy our HSSE risk 
  of delivery and efficiency,     is Steady, even though           management in line 
  conclude the integration        there is no near term            with best practices 
  of the newly acquired           line of sight for                and with strong emphasis 
  Eland Assets into               an alternative evacuation        on prevention. 
  our business, consolidate       line, in the sudden 
  performance across              event of prolonged 
  board, maximise production,     outage of the TFP. 
  maintain a strong               Alternative line (AEP) 
  balance sheet, and              is now scheduled for 
  strategically position          Q2 2021 delivery. 
  the Company for future 
  growth. 
                                -------------------------------  ------------------------------ 
 
 
 Operational risks continued 
 Infectious diseases            Sustaining E&A programme 
  outbreak in Seplat 
  (e.g. Covid-19) 
                               ------------------------------ 
 Description                    Description 
  Risk of an index               Exploration and appraisal 
  case manifesting in            activities carry significant 
  Seplat offices or              levels of subsurface 
  field locations. This          risk. Sustained E&A 
  leads to an unsuccessful       drilling failure will 
  initial control of             impact the Company's 
  an index case (probably        ability to organically 
  resulting in communal          replace reserves and 
  spread of the disease          production. 
  in the Seplat community 
  as a result of late 
  detection of secondary 
  contact cases which 
  may have had close 
  contacts with index 
  case or close contacts 
  from other external 
  primary sources). 
  Risk also covers supply 
  chain disruptions 
  emanating from the 
  pandemic i.e. the 
  extent to which the 
  disease will have 
  an impact on all key 
  projects of the Company 
  (including ANOH) as 
  designed in the work 
  programme (impacting 
  the supply chain and 
  major contractors 
  scheduled to deliver 
  in a few months). 
                               ------------------------------ 
 Mitigation                     Mitigation 
  Appointment of the             Strict compliance 
  COVIMOG (monitoring            with reservoir management 
  and response team)             guidelines. Building 
  to assess the dynamics         internal capacity 
  of the virus and report        with skilled sub-surface 
  to leadership weekly.          expertise. Drill a 
  Install hand washing           minimum of two exploration 
  and sanitiser dispensers       wells, as well as 
  across all business            continuous M&A work 
  locations. Avoid large         to secure available 
  crowd and physical             opportunities at the 
  meetings of more than          right price. 
  50 people. Avoid external 
  meetings; encourage 
  online meetings. Encourage 
  staffs and other tenants 
  on the building on 
  washing of hands and 
  use of sanitiser. 
  Suspend all non critical 
  travel plans and in 
  the event of critical 
  travels, put in place 
  mandatory self quarantine 
  and testing. Put in 
  place mandatory PCR 
  testing for all field 
  operations. LT alignment 
  on business scenarios 
  to gain stability 
  post-epidemic. Have 
  a Business Continuity 
  Plan in place to curb 
  post-economic recovery 
  challenges. Run an 
  operations impact 
  assessment and trigger 
  identification of 
  quick remediation 
  strategies/wins across 
  the business. Manage 
  press/publicity and 
  communication to avoid 
  mis-communication/ 
  wrong press. Declare 
  work from home with 
  effective IT support. 
                               ------------------------------ 
 KPI/Performance metric         KPI/Performance metric 
  HSSE scorecards                Reserve replacement 
  LTIF 
  TRIR 
                               ------------------------------ 
 Strategic pillars              Strategic pillars 
  1, 2, 3, 4                     1, 2, 3, 5 
                               ------------------------------ 
 Assessment                     Assessment 
  High                           Very high 
                               ------------------------------ 
 Trend                          Trend 
  Rising. Trend is               Steady. High grading 
  rising given the second        our exploration portfolio 
  wave of the pandemic           through a thorough 
  with its attendant             prospect screening 
  contagious spread              exercise. In the near 
  and the notable cases          term, plan is to commence 
  recorded. The Company          exploration drilling 
  will sustain the deployment    campaign in the West. 
  of our HSE risk management 
  in line with best 
  practices and with 
  strong emphasis on 
  reducing the impact 
  of this unprecedented 
  pandemic. 
                               ------------------------------ 
 
 
 External risks 
 Niger Delta stability           Stakeholder management            Geopolitical risk 
  and security                    relationships 
                                --------------------------------  -------------------------------- 
 Description                     Description                       Description 
  The Company operates            Failure to manage                 Nigeria has at times 
  in a region where               stakeholders can result           in its history faced 
  security incidents              in business disruptions           political uncertainties 
  such as kidnappings,            and interference.                 and threats such as 
  vandalism and criminal          The Company prioritises           terrorism aimed at 
  attacks on O&G installations    the effective management          de-stabilising and 
  can occur.                      of relationships with             undermining the orderly 
                                  all stakeholders including        and effective rule 
                                  host communities,                 of central government. 
                                  JV partners, government, 
                                  regulatory bodies 
                                  and shareholders. 
                                --------------------------------  -------------------------------- 
 Mitigation                      Mitigation                        Mitigation 
  Continuous security             Successful operation              Scenarios and response 
  monitoring and intelligence     of the GMOU agreement             options plan set. 
  work. Quick mechanism           with host communities,            Crisis management 
  for security advisory           periodic engagement               team in place for 
  to staff and movement           and feedback forums.              high alert political 
  restriction for high            Tailored CSR programmes,          periods. Continue 
  alert situations.               capacity building                 to partner/network 
  Active participation            and infrastructure                with security stakeholders 
  in the industry pressure        developments with                 and share intelligence 
  groups to find lasting          the host communities.             regarding security. 
  solution.                       Sustain local content             Business continuity 
                                  development with priority         plans actioned in 
                                  to community contractors.         light of current geo-political 
                                  Organisational focus              situation. 
                                  and clear strategy 
                                  to deliver shareholder 
                                  value pursued by the 
                                  Board and management. 
                                  Corporate governance, 
                                  transparency and proactiveness 
                                  in dealings with regulators 
                                  and JV partners. 
                                --------------------------------  -------------------------------- 
 KPI/Performance metric          KPI/Performance metric            KPI/Performance metric 
  LTIR                            Net working interest              Be a highly responsible 
  TRIR                            production                        corporate citizen 
  Security incidents              LTIR                              Maximise production 
  Operating cash flow             TRIR                              and cash flows from 
                                  Host community incidences         existing assets 
                                                                    Commercialise and 
                                                                    produce gas reserves 
                                --------------------------------  -------------------------------- 
 Strategic pillars               Strategic pillars                 Strategic pillars 
  2, 5                            2, 3, 5                           1, 2, 5 
                                --------------------------------  -------------------------------- 
 Assessment                      Assessment                        Assessment 
  Very high                       High                              High 
                                --------------------------------  -------------------------------- 
 Trend                           Trend                             Trend 
  Steady. Efforts by              Steady. We continue               Steady. 
  the Government and              to enjoy good working 
  industry pressure               relations with our 
  groups, aimed at enhancing      stakeholders. 
  security in the region 
  seems to be paying 
  off as there was a 
  significant drop in 
  targeted oil and gas 
  facilities attacks 
  in the region in year 
  2020. We will continue 
  our monitoring and 
  vigilance. 
                                --------------------------------  -------------------------------- 
 
 
 Financial risks 
 Oil price volatility         Changes to tax status            Availability of capital 
                               and legislation 
                             -------------------------------  -------------------------------- 
 Description                  Description                      Description 
  Oil prices have exhibited    If the tax regime/legislation    The oil and gas industry 
  a history of volatility      under which the Company          is highly capital 
  and can fluctuate            operates its assets              intensive. Significant 
  sharply in line with         were to change, profitability    amounts of capital 
  external factors.            may be impacted.                 are required to continue 
                                                                development activities 
                                                                and fund M&A. Non 
                                                                funding of cashcalls 
                                                                by JV partners impacts 
                                                                activities and liquidity. 
                             -------------------------------  -------------------------------- 
 Mitigation                   Mitigation                       Mitigation 
  Hedging continues            Perform evaluation               Emphasis on compliance 
  to be our price risk         of business plan and             with requirements 
  management tool. Price       performance metrics              of the JV operating 
  sensitisation on project     exclusive of tax benefits.       agreement for effective/strict 
  economics and cost           Project economics                JV partner concurrence. 
  discipline for capital       were determined on               Board review and approval 
  projects sanctioning.        maximum tax basis                of financial strategy 
  Aggressive focus on          to mitigate the impact           and debt portfolio 
  cost reduction.              of the now expired               management with strong 
                               pioneer tax status.              banking relationships. 
                               Impact assessment 
                               of potential tax legislature 
                               monitored at the Board 
                               level. 
                             -------------------------------  -------------------------------- 
 KPI/Performance metric       KPI/Performance metric           KPI/Performance metric 
  Realised oil price           Effective tax rate               JV receivables 
  Operating cash flow          Tax status                       Capex 
                                                                New M&A activities 
                             -------------------------------  -------------------------------- 
 Strategic pillars            Strategic pillars                Strategic pillars 
  2                            2, 3                             2, 3, 5 
                             -------------------------------  -------------------------------- 
 Assessment                   Assessment                       Assessment 
  High                         High                             Very high 
                             -------------------------------  -------------------------------- 
 Trend                        Trend                            Trend 
  Decreasing. In the           Steady. PIB is going             Decreasing. JV partners 
  year 2020, we kept           through legislative              continues to remain 
  focus of our price           process. Versions                current in paying 
  risk management policy       in circulation currently         cash calls. 
  to protect the Company's     being reviewed to 
  cash flow stream from        assess the impact 
  downside scenarios.          on Seplat valuation. 
  We will also continue 
  to take hedge positions 
  and apply cost reduction 
  strategies. 
                             -------------------------------  -------------------------------- 
 
 
 Financial risks continued 
 Cost control risk           Liquidity                            Foreign exchange risk 
                            -----------------------------------  --------------------------- 
 Description                 Description                          Description 
  Cost reduction remains      Liquidity risk is                    The Company is exposed 
  central to the Company's    the risk that the                    to exchange rate risk 
  current operating           Company will not be                  to the extent that 
  strategy. High operating    able to meet its financial           balances and transactions 
  cost and ineffective        obligations as they                  are denominated in 
  capital cost control        fall due.                            a currency other than 
  negatively impacts                                               the US Dollar. 
  operating cash flows 
  and profitability. 
                            -----------------------------------  --------------------------- 
 Mitigation                  Mitigation                           Mitigation 
  Comprehensive budgeting     Manage liquidity                     The Company has options 
  process approved by         risk by ensuring that                to manage its foreign 
  the joint venture           sufficient funds are                 exchange exposure 
  partner and the Board.      available to meet                    including financial 
  Clear cost management       commitments as they                  hedge instruments 
  targets. Grading of         fall due. Uses both                  such as forward exchange 
  portfolio opportunities     long-term and short-term             contracts. 
  and project ranking         cash flow projections 
  for capital allocation.     to monitor funding 
  Focus on reducing           requirements for activities 
  drilling costs at           and to ensure there 
  well design phase.          are sufficient cash 
  Cost monitoring and         resources to meet 
  periodic reporting.         operational needs. 
  Focus on effective          Cash flow projections 
  contracting strategies      take into consideration 
  for cost reduction.         the Company's debts 
                              and covenant compliance. 
                              Surplus cash held 
                              is transferred to 
                              the treasury department 
                              which invests in interest-bearing 
                              current accounts, 
                              time deposits and 
                              money market deposits. 
                            -----------------------------------  --------------------------- 
 KPI/Performance metric      KPI/Performance metric               KPI/Performance metric 
  Operating cost per          Operating cash flow                  Operating cash flow 
  boe                         Capex                                Capex 
  EBIT 
  Capex 
  Well costs 
                            -----------------------------------  --------------------------- 
 Strategic pillars           Strategic pillars                    Strategic pillars 
  2, 3, 5                     2                                    2, 3 
                            -----------------------------------  --------------------------- 
 Assessment                  Assessment                           Assessment 
  High                        Medium                               High 
                            -----------------------------------  --------------------------- 
 Trend                       Trend                                Trend 
  Steady. Cost discipline     Steady. Improved                     Steady. Historically, 
  remains key focus           uptime of TFP; improved              the Company holds 
  of the business.            JV cash call payment;                majority of its cash 
                              oil price rally; and                 and cash equivalent 
                              strategic debt refinancing           in US Dollar. Gas 
                              all have greatly improved            contracts are indexed 
                              liquidity risk.                      in US Dollar. 
                            -----------------------------------  --------------------------- 
 
 
 Strategic risks 
 Portfolio concentration         Merger & Acquisition             Bribery and corruption 
  risk                            (M&A) risk                       risk 
                                -------------------------------  ----------------------------- 
 Description                     Description                      Description 
  High dependency on              Growth through M&A               Bribery and corruption 
  a concentrated portfolio        activities is part               presents a risk throughout 
  of producing blocks             of Seplat's strategy             the global oil and 
  and limited number              to pursue a focused              gas industry and represents 
  of wells can leave              acquisition and farm-in.         an ongoing risk to 
  the Company more susceptible    M&A deals and transactions       any oil and gas company. 
  to declining long-term          come with significant 
  growth and reserves             risk including structural, 
  depletion.                      commercial and integration 
                                  risks. There is also 
                                  the risk of non achievement 
                                  of acquisition targets 
                                  due to highly competitive 
                                  landscape. 
                                -------------------------------  ----------------------------- 
 Mitigation                      Mitigation                       Mitigation 
  Focus on portfolio              New business development         Extensive training 
  expansion strategy              unit is always looking           on anti-bribery and 
  from the Board level            for the right opportunities      corruption. Embedding 
  to diversify current            for Seplat. Decision             corporate governance 
  portfolio. Integrated           review board (DRB)               principles with key 
  long-term planning              process is in place              focus on areas of 
  on crude oil and gas            to ensure deals are              the business which 
  business.                       properly vetted and              may be more susceptible 
                                  adequate due diligence           to corruption such 
                                  done on new opportunities.       as the contracting 
                                  The DRB ensures the              and procurement process. 
                                  commercial, structural,          Processes exist to 
                                  KYC and integration              guide dealings with 
                                  risks are fully considered       public officials. 
                                  and addressed with 
                                  mitigation plan approved 
                                  and in place prior 
                                  to deal closing. 
                                -------------------------------  ----------------------------- 
 KPI/Performance metric          KPI/Performance metric           KPI/Performance metric 
  Successful execution            Successful execution             Whistleblowing reports 
  of new acquisition              of new acquisition               Number of disciplinary 
  and farm-in opportunities       and farm-in opportunities        cases 
                                -------------------------------  ----------------------------- 
 Strategic pillars               Strategic pillars                Strategic pillars 
  2, 3                            1, 3, 5                          5 
                                -------------------------------  ----------------------------- 
 Assessment                      Assessment                       Assessment 
  High                            Very high                        Very high 
                                -------------------------------  ----------------------------- 
 Trend                           Trend                            Trend 
  Steady. The Company             Steady. DRB process              Decreasing. As geographical 
  is in build/transform           in place to vet opportunities    location continues 
  phase.                          and deals. Risk trend            to be susceptible 
                                  steady following ongoing         to corruption, risk 
                                  integration of Eland             trend changed from 
                                  Oil and Gas Plc, as              steady to decreasing. 
                                  well as ongoing strategy 
                                  to acquire more strategic 
                                  assets. M&A landscape 
                                  remains competitive. 
                                -------------------------------  ----------------------------- 
 
 
 Strategic risks continued 
 Loss of key employees       Fraudulent activity            Information security 
                              risk                           risk 
                            -----------------------------  ------------------------------ 
 Description                 Description                    Description 
  The oil and gas industry    Fraudulent activity            Potential cyber attacks 
  is very specialised         presents a risk throughout     and information technology 
  in certain areas and        the global oil and             security breaches 
  there is competition        gas industry and represents    could result in loss 
  within the industry         an ongoing risk to             or compromise of sensitive 
  to secure talent and        any oil and gas company.       proprietary information, 
  highly-skilled and                                         communication and 
  experienced personnel                                      IT business continuity 
  in core areas.                                             disruption across 
                                                             operations. 
                            -----------------------------  ------------------------------ 
 Mitigation                  Mitigation                     Mitigation 
  Annual benchmark            Extensive whistleblowing       We monitor and regularly 
  reviews to ensure           campaign. Continuous           upgrade the Company's 
  competitiveness in          monitoring and improvement     information technology 
  reward and recruitment.     of the system of internal      and security systems. 
  Succession planning         controls by all lines          The Company has a 
  in place as part of         of defence with strong         clearly defined employee 
  business continuity.        internal audit activity.       user policy and control 
  Focus on training           Automation of processes        of access rights. 
  as a key differentiating    where possible to              Our information security 
  factor in the operating     reduce manual intervention.    framework and infrastructure 
  environment.                                               have been externally 
                                                             reviewed in line with 
                                                             requirements of ISO 
                                                             27001. IT business 
                                                             continuity plan is 
                                                             in place for quick 
                                                             deployment. 
                            -----------------------------  ------------------------------ 
 KPI/Performance metric      KPI/Performance metric         KPI/Performance metric 
  Staff turnover              Number of reported             Information security 
                              cases                          identification and 
                                                             containment reports 
                            -----------------------------  ------------------------------ 
 Strategic pillars           Strategic pillars              Strategic pillars 
  2, 5                        5                              2, 5 
                            -----------------------------  ------------------------------ 
 Assessment                  Assessment                     Assessment 
  Medium                      Very high                      High 
                            -----------------------------  ------------------------------ 
 Trend                       Trend                          Trend 
  Steady. Risk trend          Steady. Risk is kept           Rising. While cyber 
  changed to steady           at very high and the           security continues 
  this period.                Company continues              to hold international 
                              to maintain a zero             attention, there has 
                              tolerance policy.              not been material 
                                                             IT breach on our operations. 
                                                             However, the triggering 
                                                             of the work from home 
                                                             policy has resulted 
                                                             in a rising trend 
                                                             of the risk, given 
                                                             the greater number 
                                                             of employees working 
                                                             externally. 
                            -----------------------------  ------------------------------ 
 

Appendix C: Related Party Transactions

The following Related party relationships and transactions are extracted from the 2020 Annual Report and Accounts (page 231 )

41. Related party relationships and transactions

The Group is controlled by Seplat Petroleum Development Company Plc (the parent Company). The parent Company is owned 6.43% either directly or by entities controlled by A.B.C. Orjiako (SPDCL(BVI)) and members of his family and 10.21% either directly or by entities controlled by Austin Avuru (Professional Support Limited and Platform Petroleum Limited). The remaining shares in the parent Company are widely held.

The goods and services provided by the related parties are disclosed below. The outstanding balances payable to/receivable from related parties are unsecured and are payable/receivable in cash.

1. Shareholders of the parent Company

Shebah Petroleum Development Company Limited SPDCL (BVI):

The Chairman of Seplat is a director and shareholder of SPDCL (BVI). The Company provided consulting services to Seplat. Services provided to the Group during the period amounted to $900 thousand, 342 million (2019: $1.05 million, 322 million).

2. Entities controlled by key management personnel (Contracts>$1million in 2020)

Cardinal Drilling Services Limited (formerly Caroil Drilling Nigeria Limited):

The Company is owned by common shareholders with the parent Company. The Company provides drilling rigs and drilling services to Seplat. Transactions with this related party amounted to $5.7 million, 2.1 billion (2019: $9.44 million, 2.89 billion). Payables amounted to $591 thousand, 225 million in the current period (Payables in 2019: nil).

3. Entities controlled by key management personnel (Contracts<$1million in 2020)

Abbeycourt Trading Company Limited:

The Chairman of Seplat is a director and shareholder. The Company provides diesel supplies to Seplat in respect of Seplat's rig operations. This amounted to $296 thousand, 106 million during the period (2019: $0.93 million, 286 million). Payables amounted to $15,273, 5.8 million (2019: nil).

Stage leasing (Ndosumili Ventures Limited):

A subsidiary of Platform Petroleum Limited (an entity in which Austin Avuru has an equity interest). The Company provides transportation services to Seplat. This amounted to $714 thousand, 257million (2019: $1.45 million, 445 million). Payables amounted to $23,572, 8.9 million (2019: nil).

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