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SEPL Seplat Energy Plc

144.80
0.40 (0.28%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Seplat Energy Plc LSE:SEPL London Ordinary Share NGSEPLAT0008 ORD NGN0.50 (DI)
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.40 0.28% 144.80 144.40 144.80 145.00 144.40 144.60 71,394 16:19:53
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Oil & Gas Field Services,nec 696.87B 54.58B 92.7479 0.02 1.08B

SEPLAT Petroleum Development Co PLC 2018 Annual Report and Notice of AGM (3453V)

08/04/2019 7:01am

UK Regulatory


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TIDMSEPL

RNS Number : 3453V

SEPLAT Petroleum Development Co PLC

08 April 2019

8 April 2019

Seplat Petroleum Development Company Plc

2018 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 2018 together with the notice of the Company's sixth Annual General Meeting ("AGM") and forms of proxy. The Company will hold its AGM at 11:00am (local time) on Thursday 16 May 2019 at the Civic Centre, Ozumba Mbadiwe Road, Victoria Island, 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 2018, 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 6 March 2019. That information, together with the Appendices to this announcement, which contains the following additional information that has been extracted from the 2018 Annual Report, constitutes the material required for the purposes of compliance with DTR 6.3.5 only:

   --                  the Statement of Directors' Responsibilities; 
   --                  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 2018 Annual Report. Page and note references in the text below refer to page numbers and notes in the 2018 Annual Report and terms defined in that document have the same meanings in these extracts.

Enquiries

 
 Seplat Petroleum Development Company plc 
 Roger Brown, CFO                             +44 (0) 203 725 6500 
 Andrew Dymond, Head of Investor Relations 
 Ayeesha Aliyu, Investor Relations            +234 (01) 277 0400 
 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 oil and gas exploration and production 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 2018 Annual Report and Accounts (page 114).

The Companies and Allied Matters Act, CAP C20, Laws of the Federation of Nigeria 2004, requires the Directors to prepare financial statements for each financial year that give 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, CAP C20, Laws of the Federation of Nigeria 2004;

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, 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, CAP C20, Laws of the Federation of Nigeria 2004 and Financial Reporting Council of Nigeria Act, No. 6, 2011.

The Directors are of the opinion that the financial statements give 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 twelve months from the date of this statement.

Signed on behalf of the Directors by:

A.B.C Orjiako Austin Avuru

Chairman Chief Executive Officer

   FRC/2014/IODN/00000003161                                           FRC/2014/IODN/00000003100 
   6 March 2019                                                                         6 March 2019 

Appendix B: Principal risks and uncertainties

The following principal risks and uncertainties table is extracted from the 2018 Annual Report and Accounts (pages 48 to 51).

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

 
 Key risk         Description          Mitigation          KPI/Performance                                             Strategic   Assessment   Trend 
                                                            metric                                                      pillars 
 Operational risks 
 Field            Failure              Focus on risk                                                                               High         We continue 
 operations       to manage            management            *    Net working interest production                                               to refine 
 and project      operational          at planning phase                                                                                        our project 
 deliverability   activities           and mitigation                                                                                           management 
                  in line              plans activated.      *    Operating costs per boe                                                       approach 
                  with planned         Compulsory                                                                                               for improved 
                  expectations         'peer-to-peer'                                                                                           speed of 
                  can lead             review for                                                                                               delivery 
                  to production        high-value                                                                                               and 
                  misses,              projects and                                                                                             efficiency 
                  project              better 
                  delays               project 
                  and cost             management 
                  overruns,            techniques. 
                  high production      Protracted 
                  costs and            land acquisition, 
                  earlier              preparation and 
                  than expected        rig startup have 
                  field                been contributory 
                  decommissioning.     factors which 
                                       have 
                                       received focused 
                                       attention and 
                                       significant 
                                       process 
                                       improvements 
                                       and improved 
                                       communications 
                                       with JV partner 
                                       and approving 
                                       regulators 
                                       to mitigate 
                                       delays. 
                                       Use of 
                                       smart/intelligent 
                                       wells to improve 
                                       recovery and 
                                       improved 
                                       rig performance 
                                       monitoring 
                                       and reporting to 
                                       manage NPTs. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Third            An over-reliance     Work is ongoing                                                                             Very         Remarkably 
 party             on third            to secure a           *    Net working interest production                                   high        improved 
 infrastructure    party operated      second                                                                                                   uptime 
 downtime          transportation      export line to                                                                                           of Forcados 
                   infrastructure      complement            *    Days downtime                                                                 export 
                   can expose          Forcados.                                                                                                system 
                   the Company         Export via                                                                                               and progress 
                   to extended         barging               *    EBIT                                                                          made towards 
                   periods             is also retained                                                                                         completing 
                   of production       to do limited                                                                                            Amukpe 
                   being shut-in.      volumes                                                                                                  - Escravos 
                                       in extreme cases.                                                                                        exportline 
                                       Have two                                                                                                 as 
                                       contingency                                                                                              alternative 
                                       tanks in Amukpe 
                                       for partial 
                                       storage 
                                       during shut-in 
                                       over shorter 
                                       periods. 
                                       More tanks are 
                                       planned. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 HSSE             Oil and              Deployment of an                                                                            High         Though 
                  gas activities       HSSE Management       *    HSSE scorecards                                                               the risk 
                  carry significant    System in line                                                                                           is inherent, 
                  levels               with best                                                                                                we will 
                  of HSSE              practices.            *    LTIF                                                                          continue 
                  risks if             Monitoring and                                                                                           to deploy 
                  not properly         reporting of HSSE                                                                                        our HSSE 
                  managed.             performance           *    TRIR                                                                          risk 
                  As activity          scorecards                                                                                               management 
                  levels               at management and                                                                                        in line 
                  continue             Board levels. Our                                                                                        with best 
                  to increase          HSSE systems and                                                                                         practices 
                  there is             process are                                                                                              and with 
                  a strong             subject                                                                                                  strong 
                  focus on             to independent                                                                                           emphasis 
                  preventing           review and                                                                                               on 
                  major                identified                                                                                               prevention. 
                  environmental,       improvement 
                  health               initiatives 
                  or safety            are deployed. 
                  incidents.           Continual 
                                       focus on HSSE 
                                       training 
                                       and initiatives 
                                       on incidence 
                                       prevention. 
                                       Emergency 
                                       Response 
                                       plan set for any 
                                       eventuality and 
                                       comprehensive 
                                       Incident 
                                       Review panels to 
                                       identify and 
                                       channel 
                                       lessons learnt 
                                       to improvement 
                                       activities. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Sustained        Exploration          Strict compliance                                                                           Very         Reduced 
  E&A programme    and appraisal       with reservoir        *    Reserve replacement                                               high        E&A 
  failure          activities          management                                                                                               activities. 
                   carry significant   guidelines.                                                                                              Will monitor 
                   levels              Building internal                                                                                        the outcomes 
                   of subsurface       capacity with                                                                                            as E&A 
                   risk. Sustained     skilled                                                                                                  activities 
                   E&A drilling        subsurface                                                                                               ramp up. 
                   failure             expertise. 
                   will impact 
                   the Company's 
                   ability 
                   to organically 
                   replace 
                   reserves 
                   and production. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 External risks 
 Niger            The Company          Continuous                                                                                  Very         Significant 
  Delta            operates            security              *    LTIF                                                              high        drop in 
  stability        in a region         monitoring and                                                                                           targeted 
  and security     where security      intelligence                                                                                             oil and 
                   incidents           work.                 *    TRIR                                                                          gas 
                   such as             Quick mechanism                                                                                          facilities 
                   kidnappings,        for security                                                                                             attacks 
                   vandalism           advisory              *    Security incidents                                                            in the 
                   and criminal        to staff and                                                                                             region 
                   attacks             movement                                                                                                 in 2018. 
                   on O&G              restriction for                                                                                          We will 
                   installations       high alert                                                                                               continue 
                   can occur.          situations.                                                                                              our 
                                       Active                                                                                                   monitoring 
                                       participation                                                                                            and 
                                       in industry                                                                                              vigilance. 
                                       pressure 
                                       groups to find 
                                       lasting solution. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Failure          Failure              Successful                                                                                  High         We continue 
  to manage        to manage           operation             *    Net working interest production                                               to enjoy 
  stakeholder      stakeholders        of the GMOU                                                                                              good working 
  relationships    can result          agreement                                                                                                relations 
                   in business         with host             *    LTIR                                                                          with our 
                   disruptions         communities,                                                                                             stakeholders. 
                   and interference.   periodic 
                   The Company         engagement            *    TRIR 
                   prioritises         and feedback 
                   the effective       forums. 
                   management          Tailored CSR          *    Host community incidences 
                   of relationships    programmes, 
                   with all            capacity building 
                   stakeholders        and 
                   including           infrastructure 
                   host communities,   developments with 
                   JV partners,        the host 
                   government,         communities. 
                   regulatory          Organisational 
                   bodies              focus and clear 
                   and shareholders.   strategy to 
                                       deliver 
                                       shareholder value 
                                       pursued by the 
                                       Board and 
                                       management. 
                                       Corporate 
                                       governance, 
                                       transparency and 
                                       proactiveness in 
                                       dealings with 
                                       regulators 
                                       and JV partners. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Geo-political    Nigeria              Scenarios and                                                                               High         With 
  risk             has at              response              *    Occurrences of civil unrest and terrorism                                     elections 
                   times in            options plan set.                                                                                        in 2019, 
                   its history         Crisis management                                                                                        we will 
                   faced political     team in place for                                                                                        continue 
                   uncertainties       high alert                                                                                               to monitor 
                   and threats         political                                                                                                situations 
                   such as             periods. Business                                                                                        closely. 
                   terrorism           continuity plans 
                   aimed at            actioned in light 
                   de-stabilising      of current 
                   and undermining     geo-political 
                   the orderly         situation. 
                   and effective 
                   rule of 
                   central 
                   government. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Financial risks 
 Oil price        Oil prices           Hedging continues                                                                           Very         Though 
  volatility       have exhibited      to be our price            *    Realised oil price                                           high        oil price 
                   a history           risk management                                                                                          rallied 
                   of volatility       tool. Price                                                                                              to above 
                   and can             sensitisation              *    Operating cash flow                                                      $80 in 
                   fluctuate           on project                                                                                               2018, we 
                   sharply             economics                                                                                                will continue 
                   in line             and cost                                                                                                 to take 
                   with external       discipline                                                                                               hedge 
                   factors             for capital                                                                                              positions 
                                       projects                                                                                                 and apply 
                                       sanctioning.                                                                                             cost 
                                       Aggressive                                                                                               reduction 
                                       focus on cost                                                                                            strategies. 
                                       reduction. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Changes          If the               Perform                                                                                     High         PIB is 
 to tax           tax                  evaluation            *    Effective tax rate                                                            going through 
 status           regime/legislation   of business plan                                                                                         legislative 
 and              under which          and performance                                                                                          process. 
 legislation      the Company          metrics exclusive     *    Tax status                                                                    Versions 
                  operates             of tax benefits.                                                                                         in 
                  its assets           Project economics                                                                                        circulation 
                  were to              were determined                                                                                          do not 
                  change,              on maximum tax                                                                                           have 
                  profitability        basis to mitigate                                                                                        significant 
                  may be               the impact of the                                                                                        impact 
                  impacted.            now expired                                                                                              on Seplat 
                                       pioneer                                                                                                  valuation. 
                                       tax status. 
                                       Impact 
                                       assessment of 
                                       potential 
                                       tax legislature 
                                       monitored at 
                                       Board 
                                       level. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Availability     The oil              Working on                                                                                  High         JV partners 
  of capital       and gas             different             *    JV receivables                                                                 cash calls 
                   industry            funding                                                                                                   are now 
                   is highly           arrangements                                                                                              on time 
                   capital             with JV partners.     *    Capex                                                                          and legacy 
                   intensive.          Board review and                                                                                          cash call 
                   Significant         approval of                                                                                               receivables 
                   amounts             financial             *    New M&A activities                                                             have been 
                   of capital          strategy and debt                                                                                         cleared. 
                   are required        portfolio 
                   to continue         management 
                   development         with strong 
                   activities          banking 
                   and fund            relationships 
                   M&A. Non 
                   funding 
                   of cash 
                   calls by 
                   JV partners 
                   impacts 
                   activities 
                   and liquidity. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Ineffective      Cost reduction       Comprehensive                                                                               High         Cost 
  cost            remains              budgeting             *    Operating cost per boe                                                        discipline 
  control         central              process approved                                                                                         remains 
                  to the               by the joint                                                                                             key focus 
                  Company's            venture               *    EBIT                                                                          of the 
                  current              partner and the                                                                                          business. 
                  operating            Board. Clear cost 
                  strategy.            management            *    Capex 
                  High operating       targets. 
                  cost and             Grading of 
                  ineffective          portfolio             *    Well costs 
                  capital              opportunities and 
                  cost control         project ranking 
                  negatively           for capital 
                  impact               allocation. 
                  operating            Focus on reducing 
                  cash flows           drilling costs 
                  and profitability.   at well design 
                                       phase. Cost 
                                       monitoring 
                                       and periodic 
                                       reporting. 
                                       Focus on 
                                       effective 
                                       contracting 
                                       strategies 
                                       for cost 
                                       reduction. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Liquidity        Liquidity            Manage liquidity                                                                            High         Improved 
                   risk is             risk by ensuring      *    Operating cash flow                                                           uptime 
                   the risk            that sufficient                                                                                          of TFP; 
                   that the            funds are                                                                                                improved 
                   Company             available             *    Capex                                                                         JV cash 
                   will not            to meet                                                                                                  call payment; 
                   be able             commitments                                                                                              oil price 
                   to meet             as they fall due.                                                                                        rally; 
                   its financial       Uses both                                                                                                and debt 
                   obligations         long-term                                                                                                refinance 
                   as they             and short-term                                                                                           have all 
                   fall due.           cash flow                                                                                                greatly 
                                       projections                                                                                              improved 
                                       to monitor                                                                                               liquidity 
                                       funding                                                                                                  risk. 
                                       requirements for 
                                       activities and 
                                       to ensure there 
                                       are sufficient 
                                       cash resources 
                                       to meet 
                                       operational 
                                       needs. Cash flow 
                                       projections take 
                                       into 
                                       consideration 
                                       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. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Foreign          The Company          The Company has                                                                             High         Historically, 
  exchange         is exposed          options to manage     *    Operating cash flow                                                           the Company 
                   to exchange         its foreign                                                                                              holds 
                   rate risk           exchange                                                                                                 majority 
                   to the              exposure              *    Capex                                                                         of its 
                   extent              including                                                                                                cash and 
                   that balances       financial hedge                                                                                          cash 
                   and transactions    instruments such                                                                                         equivalent 
                   are denominated     as forward                                                                                               in US dollar. 
                   in a currency       exchange                                                                                                 Gas contracts 
                   other than          contracts.                                                                                               are indexed 
                   the US                                                                                                                       in US dollar. 
                   dollar.                                                                                                                      However, 
                                                                                                                                                the Naira 
                                                                                                                                                may be 
                                                                                                                                                devalued 
                                                                                                                                                post 
                                                                                                                                                elections. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Strategic risks 
 Portfolio        High dependency      Focus on                                                                                    Very         The Company 
  concentration    on a concentrated   portfolio            *    Successful execution of new acquisition and farm-in                high        is in 
  risk             portfolio           expansion                 opportunities                                                                  portfolio 
                   of producing        strategy                                                                                                 expansion 
                   blocks              from the Board                                                                                           phase. 
                   and limited         level to 
                   number              diversify 
                   of wells            current 
                   can leave           portfolio. 
                   the Company         Integrated 
                   more susceptible    long-term 
                   to declining        planning on crude 
                   long-term           oil and gas 
                   growth              business. 
                   and reserves 
                   depletion. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Merger           Growth               New business                                                                                Very         DRB process 
  & Acquisition    through             development          *    Successful execution of new acquisition and farm-in                high        in place 
  ('M&A')          M&A activities      unit is always            opportunities                                                                  to vet 
  risk             is part             looking for the                                                                                          opportunities 
                   of Seplat's         right                                                                                                    and deals. 
                   strategy            opportunities                                                                                            But current 
                   to pursue           for Seplat.                                                                                              M&A landscape 
                   a focused           Decision                                                                                                 is 
                   acquisition         review board                                                                                             competitive. 
                   and farm-in.        (DRB) 
                   M&A deals           process is in 
                   and transactions    place 
                   come with           to ensure deals 
                   significant         are properly 
                   risk including      vetted 
                   structural,         and adequate due 
                   commercial          diligence done 
                   and integration     on new 
                   risks.              opportunities. 
                   There is            The DRB ensures 
                   also the            the commercial, 
                   risk of             structural, KYC 
                   non achievement     and integration 
                   of acquisition      risks are fully 
                   targets             considered and 
                   due to              addressed with 
                   highly              mitigation plan 
                   competitive         approved and in 
                   landscape.          place prior to 
                                       deal closin 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Bribery          Bribery              Extensive                                                                                   High         As 
 and corruption    and corruption      training              *    Whistleblowing reports                                                        geographical 
 risk              presents            on anti-bribery                                                                                          location 
                   a risk              and corruption.                                                                                          continues 
                   throughout          Embedding             *    Number of disciplinary cases                                                  to be 
                   the global          corporate                                                                                                susceptible 
                   oil and             governance                                                                                               to 
                   gas industry        principles                                                                                               corruption. 
                   and represents      with key focus 
                   an ongoing          on areas of the 
                   risk to             business which 
                   any oil             may be more 
                   and gas             susceptible 
                   company.            to corruption 
                                       such 
                                       as the 
                                       contracting 
                                       and procurement 
                                       process. 
                                       Processes 
                                       exist to guide 
                                       dealings with 
                                       public 
                                       officials. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Loss             The oil              Annual benchmark                                                                            Low          Remains 
  of key          and gas              reviews to ensure     *    Staff turnover                                                                 low risk 
  employees       industry             competitiveness                                                                                           for the 
                  is very              in reward and                                                                                             Company. 
                  specialised          recruitment. 
                  in certain           Succession 
                  areas and            planning 
                  there is             in place as part 
                  competition          of business 
                  within               continuity. 
                  the industry         Focus on training 
                  to secure            as a key 
                  talent               differentiating 
                  and highly-skilled   factor in the 
                  and experienced      operating 
                  personnel            environment. 
                  in core 
                  areas 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Fraudulent       Fraudulent           Extensive                                                                                   High         Risk is 
  activity         activity            whistleblowing        *    Number of reported cases                                                       still high 
  risk             presents            campaign.                                                                                                 and the 
                   a risk              Continuous                                                                                                Company 
                   throughout          monitoring and                                                                                            continues 
                   the global          improvement of                                                                                            to maintain 
                   oil and             the system of                                                                                             a zero 
                   gas industry        internal                                                                                                  tolerance 
                   and represents      controls by all                                                                                           policy. 
                   an ongoing          lines of defence 
                   risk to             with strong 
                   any oil             internal 
                   and gas             audit activity. 
                   company.            Automation of 
                                       processes 
                                       where possible 
                                       to reduce manual 
                                       intervention. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 Information      Potential            We monitor and                                                                              Medium       While cyber 
  security         cyber attacks       regularly upgrade    *    Information security identification and containment                            security 
  risk             and information     the Company's             reports                                                                        continues 
                   technology          information                                                                                              to hold 
                   security            technology and                                                                                           international 
                   breaches            security systems.                                                                                        attention, 
                   could result        The Company has                                                                                          there has 
                   in loss             a clearly defined                                                                                        not been 
                   or compromise       employee user                                                                                            a material 
                   of sensitive        policy                                                                                                   IT breach 
                   proprietary         and control of                                                                                           on our 
                   information,        access rights.                                                                                           operations. 
                   communication       Our information 
                   and IT              security 
                   business            framework 
                   continuity          and 
                   disruption          infrastructure 
                   across              have been 
                   operations.         externally 
                                       reviewed in line 
                                       with the 
                                       requirements 
                                       of ISO 27001. IT 
                                       business 
                                       continuity 
                                       plan is in place 
                                       for quick 
                                       deployment. 
                 -------------------  ------------------  ----------------------------------------------------------  ----------  -----------  -------------- 
 

Appendix C: Related Party Transactions

The following Related party relationships and transactions are extracted from the 2018 Annual Report and Accounts (pages 177 to 179)

37 Related party relationships and transactions

The Group is controlled by Seplat Petroleum Development Company Plc (the parent Company). The parent Company is owned 7.81% either directly or by entities controlled by A.B.C. Orjiako (SPDCL(BVI)) and members of his family and 12.04% 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.

37a Related party relationships

The services provided by the related parties:

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.

Cardinal Drilling Services Limited (formerly Caroil Drilling Nigeria Limited): Is owned by common shareholders with the parent Company. The company provides drilling rigs and drilling services to Seplat.

Charismond Nigeria Limited: The sister to the CEO works as a General Manager. The company provides administrative services including stationery and other general supplies to the field locations.

Helko Nigeria Limited: The Chairman of Seplat is shareholder and director. The company owns the lease to Seplat's main office at 25A Lugard Avenue, Lagos, Nigeria.

Keco Nigeria Enterprises: The Chief Executive Officer's sister is shareholder and director. The company provides diesel supplies to Seplat in respect of its rig operations.

Montego Upstream Services Limited: The Chairman's nephew is shareholder and director. The company provides drilling and engineering services to Seplat.

Stage Leasing (Ndosumili Ventures Limited): Is a subsidiary of Platform Petroleum Limited. The company provides transportation services to Seplat.

Neimeth International Pharmaceutical Plc: The Chairman of Seplat is also the chairman of this company. The company provides medical supplies and drugs to Seplat, which are used in connection with Seplat's corporate social responsibility and community healthcare programmes.

Nerine Support Services Limited: Is owned by common shareholders with the parent company. Seplat leases a warehouse from Nerine and the company provides agency and contract workers to Seplat.

Oriental Catering Services Limited: The Chief Executive Officer of Seplat's spouse is shareholder and director. The company provides catering services to Seplat at the staff canteen.

ResourcePro Inter Solutions Limited: The Chief Executive Officer of Seplat's in-law is its UK representative. The company supplies furniture to Seplat.

Shebah Petroleum Development Company Limited ('BVI'): The Chairman of Seplat is a director and shareholder of SPDCL (BVI). The company provided consulting services to Seplat.

The following transactions were carried by Seplat with related parties:

37b Related party transactions

Year-end balances arising from related party transactions:

 
                                                         2018       2017      2018      2017 
                                                      million    million       US$       US$ 
                                                                              '000      '000 
--------------------------------------------------  ---------  ---------  --------  -------- 
 Shareholders of the parent Company 
  SPDCL (BV)                                              333        413     1,088     1,350 
--------------------------------------------------  ---------  ---------  --------  -------- 
 Total                                                    333        413     1,088     1,350 
--------------------------------------------------  ---------  ---------  --------  -------- 
 
 Entities controlled by key management personnel: 
 Contracts > $1million in 2018 
 Nerine Support Services Limited*                       2,335      2,161     7,627     7,066 
 Cardinal Drilling Services Limited                       621      1,001     2,029     3,272 
 Helko Nigeria Limited                                      -        444         -     1,453 
 Abbey Court Trading Company Limited                      334        199     1,090       650 
 Stage Leasing (formerly Ndosumuli Venture 
  Limited)                                                434        171     1,419       560 
--------------------------------------------------  ---------  ---------  --------  -------- 
                                                        3,724      3,976    12,165    13,001 
--------------------------------------------------  ---------  ---------  --------  -------- 
 
 Contracts < $1million in 2017 
 Montego Upstream Services Limited                         24        131        79       427 
 Oriental Catering Services Limited                       199        159       650       520 
 Keco Nigeria Enterprises                                  78        110       254       361 
 ResourcePro Inter Solutions Limited                        3          9         9        31 
 Neimeth International Pharmaceutical Plc                   -          1         -         2 
 Charismond Nigeria Limited                                23         17        74        55 
--------------------------------------------------  ---------  ---------  --------  -------- 
                                                          327        427     1,066     1,396 
--------------------------------------------------  ---------  ---------  --------  -------- 
                                                        4,051      4,403    13,231    14,397 
--------------------------------------------------  ---------  ---------  --------  -------- 
 

1 Nerine on average charges a mark-up of 7.5% on agency and contract workers assigned to Seplat. The amounts shown above are gross i.e. it includes salaries and Nerine's mark-up. Total cost for agency and contracts during 2018 is 0.2 billion, 2017: 1.4 billion ($0.6 million, 2017: $4.6million).

37c Balances

The following balances were receivable from or payable to related parties as at the end of the year:

 
                                          2018       2017       2018        2017 
                                           million    million    US$ '000    US$ '000 
---------------------------------------  ---------  ---------  ----------  ---------- 
 Entities controlled by key management 
  personnel 
 Cardinal Drilling Services Limited 
  - current portion                       1,495      1,681      4,869       5,498 
 Montego Upstream Services Limited        8          -          26          - 
 ResourcePro Inter Solutions Ltd          2          -          6           - 
---------------------------------------  ---------  ---------  ----------  ---------- 
                                          1,505      1,681      4,901       5,498 
---------------------------------------  ---------  ---------  ----------  ---------- 
 
                                          2018       2017       2018        2017 
                                           million    million    US$ '000    US$ '000 
---------------------------------------  ---------  ---------  ----------  ---------- 
 Entities controlled by key management 
  personnel 
 Montego Upstream Services Limited        -          115        -           375 
 Nerine Support Services Limited          -          2          -           8 
 Keco Nigeria Enterprises                 19         8          61          25 
 Oriental Catering Services Ltd           14         -          47 
 Cardinal Drilling Services Limited       -          292        -           954 
 Abbey Court Trading Company Limited      9          -          28 
 Charismond Nigeria Limited               -          -          1 
 Stage Leasing Limited                    13         -          43 
---------------------------------------  ---------  ---------  ----------  ---------- 
                                          55         417        180         1,362 
---------------------------------------  ---------  ---------  ----------  ---------- 
 

The outstanding balances payable to/receivable from related parties are unsecured and are payable/receivable in cash.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

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April 08, 2019 02:01 ET (06:01 GMT)

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