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2019 HALF YEARLY RESULTS
Seplat Petroleum Development Company Plc 2019 Half Yearly Results - 30 July 2019
Stability Performance Growth
2019 HALF YEARLY RESULTS- 30 JULY 2019
Stability Performance Growth 2019 HALF YEARLY RESULTS- 30 JULY - - PowerPoint PPT Presentation
Seplat Petroleum Development Company Plc 2019 Half Yearly Results - 30 July 2019 Stability Performance Growth 2019 HALF YEARLY RESULTS- 30 JULY 2019 1 2019 HALF YEARLY RESULTS IMPORTANT NOTICE DISCLAIMER FORWARD-LOOKING STATEMENTS This
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2019 HALF YEARLY RESULTS
Seplat Petroleum Development Company Plc 2019 Half Yearly Results - 30 July 2019
2019 HALF YEARLY RESULTS- 30 JULY 2019
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2019 HALF YEARLY RESULTS
DISCLAIMER
FORWARD-LOOKING STATEMENTS This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements involve known and unknown risks and uncertainties, many of which are beyond the Company's control and all of which are based on the Company’s current beliefs and expectations about future events. These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements reflect the Company's current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the Company's business, results of operations, financial position, liquidity, prospects, growth, strategies and the oil and gas business. Forward-looking statements speak only as of the date they are made and cannot be relied upon as a guide to future performance. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent legally required. No part of these results constitutes, or shall be taken to constitute, an invitation or inducement to invest in the Company and must not be relied upon in any way in connection with any investment decision.
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2019 HALF YEARLY RESULTS
Austin Avuru
Seplat Petroleum Development Company Plc | www. seplatpetroleum.com
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2019 HALF YEARLY RESULTS
MAPPING SEPLAT’S ROUTE TO VALUE CREATION FOR SHAREHOLDERS
OIL BUSINESS DOMESTIC GAS BUSINESS FINANCIAL STRENGTH OPPORTUNITY RICH
development work programme
incremental growth
& optimise long term recovery
plan (see CMD materials)
performance of Oben
supplier of processed gas in 2021
& significant undrawn headroom
funded by internal cash flow
NAV and FCF accretive
maintain price discipline
Sustainable FCF generation to underpin dividend Gas business can more than double in both scale and financial contribution to the business Further diversification through commodity mix and portfolio expansion (acquisitions that offer production and reserves with growth potential)
Planned 2019 exit rate 34,000
(W.I barrels oil per day)
VALUE CREATION AND ENHANCED SHAREHOLDER RETURNS
Oben + ANOH outcome 825 MMscfd
(pro-forma gross processing capacity post ANOH completion in Q1 2021)
Cash at bank US$433 MM
(at 30 June 2019)
2P + 2C reserves & resources 561 MMboe
(at 1 January 2019)
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2019 HALF YEARLY RESULTS
Effiong Okon
Seplat Petroleum Development Company Pl c | www. seplatpetroleum.com
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2019 HALF YEARLY RESULTS 14,794 23,474 24,252 29,003 10,091 17,853 25,669 22,974 5,226 4,867 6,571 14,369 15,786 19,070 24,198 25,030
20,020 28,341 30,823 43,372 25,877 36,924 49,867 48,004
10,000 20,000 30,000 40,000 50,000 60,000 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 H1 2019 FY 2019E
boepd
24 -27 kbopd 25 – 28 kboepd Oil production Gas production
UNDERPINNED BY A STRONG PLATFORM OF PRODUCING FIELDS
production for H1 2019 stood at 48,004 boepd (H1 2018: 51,099 boepd)
(H1 2018: 25,286 bopd)
(H1 2018: 155 MMscfd)
(1) Before reconciliation losses, volumes measured at the
LACT unit, Predicated on no major force majeure event in 2019.
FY 2019 working interest production guidance
Oil 24,000 – 27,000 bopd (1) Gas 146 - 164 MMscfd (25,000 – 28,000 boepd)
Total 49,000 – 55,000 boepd
FY 2019 guidance range 49,000-55,000 boepd
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2019 HALF YEARLY RESULTS
DEVELOPMENT ACTIVITIES SET TO STEP UP IN H2 2019
WESTERN ASSETS - OML’s 4, 38, 41 & OPL 283 EASTERN ASSETS – OML 53 & OML 55
H1 2019 activities H2 2019 activities
OMLs 4,38 & 41
technical service agreement and design review
dry crude delivery from Sapele and Amukpe to Forcados Terminal
OPL 283
Igbuku field; Concept selection and FEED
OMLs 4,38 & 41
in Q4 2019;
1 rig based re-entry of an existing oil well
upgrade
OPL 283
Concept selection and FEED
H1 2019 activities H2 2019 activities
OML 53
brought onstream two oil production wells (Ohaji South 3 & 4)
well at the Jisike field
framing of crude oil storage tank in Jisike
OML 55
US$330 million discharge sum OML 53
South drilling campaign
OML 55
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2019 HALF YEARLY RESULTS
HIGHEST IMPACT VALUE ADDING WORK PROGRAMME
`
2019
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
OML 4 , 38 & 41 OML 53 Major Project Delivery Major Project Kick-off
Sapele 03 Sapele 02 Sapele 01 Sapele 03 Sapele 02 Ovhor 01 Sapele 29 Oben Ovhor 02 Appraisal well Oghareki Ohaji South 01 Jisike 06 workover Ohaji South 01 Ohaji South 02 Appraisal well Appraisal well
Development Project completion Project award Project completed Delayed
Sapele Field Liquid Treatment Facility Amukpe to Escravos Pipeline Oben Booster Compression Phase 2 & 3 Ohaji South Development, Phase 1 Sapele 01 Sapele 04 Mosogar re-entry Ovhor 06 workover Sapele 04
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2019 HALF YEARLY RESULTS
Seplat Petroleum Development Company Plc | www. seplatpetroleum.com
Roger Brown
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2019 HALF YEARLY RESULTS
SEPLAT HAS DELIVERED EXCELLENT FINANCIAL OUTCOMES
Increased gas revenues
US$1 $139 mill illio ion
Profitability sustained
US$120 120 mill illio ion
(Profit before tax)
Low operating costs
US$47 milli lion
(US$5.
$5.41/ 1/bo boe Production Opex)
Capital Investment
US$ S$28 mill illio ion
H1 2018: US$121 million
H1 2018: US$41 million (US$4.50/boe)
H1 2018: US$21 million
Dividend paid
US$ S$0.05/share
(US$29 million paid out in H1 2019)
H1 2018: US$0.05/share
Strong cash generation
US$ S$255 mill illio ion
(Cash flow from operations)
H1 2018: US$245 million H1 2018: US$85 million
EBITDA
US$ S$224 224 mill illio ion
H1 2018: US$229 million
Gross debt
US$ S$350 mill illio ion
H1 2018: US$550 million
Net cash position
US$ S$83 mill illio ion
H1 2018: Net debt US$40 million
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2019 HALF YEARLY RESULTS
US$ million H1 2019 H1 2018 change
Revenue 355 342 4% Cost of sales (148) (168) (12)% Gross profit 207 174 19% G&A (42) (38) 11% Fair value gain/(loss)-net 6 (7) Operating profit / (loss) 139 158 (12)% Net finance costs (19) (37) (49)% Profit/(Loss) before deferred tax 121 105 15% Profit/(Loss) for the period 122 49 149% Capex incurred 28 21 Cash flow from operations 255 245 4% Cash at bank 433 510
A PROFITABLE BUSINESS WITH STRONG CASH FLOW GENERATION AND ROBUST BALANCE SHEET
H1 2019 H1 2018 Gross Oil Sales 216 257 Gas sales and tolling 139 85 Total Revenue 355 342
mobilization of the rig
million; driven by increased gas processing revenues from tolling and managed costs
deconsolidation
receivables
finance costs
extracted from 2015 to 2018. In prior periods, the Group had not recognised the related income or receivable for the service because the basis for determining the fees was yet to be concluded with NPDC
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2019 HALF YEARLY RESULTS
SIMPLE STRUCTURE DRAWING ON SEPLAT BRAND AND PARTNERS TO COVER US$700 MILLION DEVELOPMENT COST
Senior Debt/Performance Bond/Vendor Finance
up to US$280 million
AGPC
Senior Debt
KEY
Equity Holdings
Seplat Plc US$210 million NGC US$210 million
PROPOSED FINANCE STRUCTURE EQUITY: ANOH DECONSILIDATED FROM SEPLAT TO AGPC DEBT: MARKET LIQUIDITY & INDICATIVE PRICING
Type of Funding USD Price Amount Available US$m Potential Lenders Period Local Banks 6.00- 9.00% 500+ UBA, Zenith, Fidelity, FCMB, FBN, Access, Union, Nova 5-7 years International Banks 4.50- 6.00% 200+ SCB, RMB, BHGE, Standard Bank, Nedbank 5-7 years Export/Vendor Finance 90 SACE, CDP, GE Deferred payment structure Total Sources of Debt 790+
Q1 2019 Q2 2019 Q3 2019 TOTAL TOTAL PENDING NGC US$100 m US$50 m US$60 m US$150 m US$60 m SEPLAT US$47.5 m US$50 m US$60 m US$97.5 m US$60 m SEPLAT HISTORICAL US$52.5 m
US$200 m US$300 m US$420 m US$120 m % INJECTED 48% 71% 100%
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2019 HALF YEARLY RESULTS
STRONG FREE CASH FLOW GENERATION AND DILIGENT MANAGEMENT OF GROUP LIQUIDITY
585 433
17 255 28 154 103 10 100 29
100 200 300 400 500 600 700 800 900
Cash Dec 2018 (including restricted cash) Receipts from OML 55 Cash from
PP&E AGPC cash deconsolidated* ANOH equity contribution Net interest plus restricted cash Loan reapayments Dividend paid Cash 30 June 2019 (including restricted cash)
US$ million Hedging strategy aimed at providing cash flow assurance
US$50.0/bbl
*Included US$100 million provided by NGC
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2019 HALF YEARLY RESULTS
SEPLAT’S CAPEX REMAINS DISCRETIONARY WITH THE FLEXIBILITY TO “DIAL UP” OR “DIAL DOWN” SPEND AS APPROPRIATE
228 64 6 7 14 90 67 54 29 1 2 41 50 49 39 59 45 24 33 60 34
50 100 150 200 250 300 350
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Initial FY2019 Revised FY2019 Drilling Facilities & engineering / other Gas projects
Capex (US$ million)
production
these expenditures will be felt from Q4 2019 into 2020
2019 CAPEX GUIDANCE REVISED TO US$150 MILLION
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2019 HALF YEARLY RESULTS
DISCIPLINED ALLOCATION OF CAPITAL WITH FURTHER DELEVERAGING IN Q1 2019
350 2018 2019 2020 2021 2022 2023 62.5 75.0 75.0 37.5 350 350 433 300
Senior notes due 2023 (9.25%) RCF due 2022 (Libor +6%) Senior notes RCF Cash 30 June 2019
US$225 million
current headroom
Debt facilities US$ million Drawn down US$ million 37.5
DIVERSE CAPITAL STRUCTURE & HEADROOM TO FUND GROWTH CURRENT DEBT MATURITY PROFILE (US$ MILLION)
Senior Notes RCF Currently Undrawn Repayment schedule if RCF was fully drawn
SEPLAT IS IN A POSITION OF FINANCIAL STRENGTH AND IS WELL FUNDED TO CAPITALISE ON GROWTH OPPORTUNITIES
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2019 HALF YEARLY RESULTS
Austin Avuru
Seplat Petroleum Development Company Plc | www. seplatpetroleum.com
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2019 HALF YEARLY RESULTS
A COMPELLING COMBINATION OF FACTORS TO MAKE SEPLAT A NIGERIAN SUCCESS STORY
RELIABLE
and predictable low unit cost production base
VISIBILITY ON MORE THAN DOUBLING
size and financial contribution of gas business
SELF FUNDED
forward organic work programme
CAPITAL ALLOCATION
to highest cash return
STEP CHANGE
potential from acquisition opportunities
SAFE AND SECURE
workplace for all staff
LOCAL CONTENT
and capacity development
DIVERSIFICATION
and asset base
SUCCESSFUL AND PROVEN
community relations model
SUSTAINABILITY IMPACT
displacing diesel with gas for power
DIVIDEND YIELD
for shareholders
2019 Half Yearly Results
Seplat Petroleum Development Company Plc | www. seplatpetroleum.com
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2019 HALF YEARLY RESULTS
London Office
Seplat Petroleum Development Company Plc Address: 4th Floor, 50 Pall Mall, London SW1Y 5JH Phone: +44 (0)20 3725 6500
Head Office
Seplat Petroleum Development Company Plc Address: 25A, Lugard Avenue, Ikoyi, Lagos, Nigeria. Phone: +234 (0)1 277 0400 Email: info@seplatpetroleum.com ir@seplatpetroleum.com Web: www.seplatpetroleum.com