Seplat Energy’s Nigerian opportunity
Transcript of Seplat Energy’s Nigerian opportunity
Seplat Energy’sNigerianopportunity
Seplat Energy Plc
29/07/2021
15.00 – 16.10
— Goodwill message from
Temi Popoola, Chief Executive Officer,
Nigerian Exchange Ltd
— Proudly Nigerian
— Introducing Seplat Energy
— Building a sustainable business
— Driving social development
— Focusing on environmental
care & reporting
— Maximising financial returns
BREAK
16.20 – 17.30
— Delivering transition
— Upstream
— Midstream Gas
— New Energy
17.30 – 18.00
Q&A
18.00
— ReceptionAgendaAgendaSeplat Energy's Nigerian opportunity 1
PROUDLY NIGERIAN
Seplat Energy's Nigerian opportunity 2
Roger BrownChief Executive Officer
A land of opportunity… POPULATION– Africa’s largest population, with more than 200m people and growing rapidly– Currently 7th largest, will be the world’s 3rd largest country in 2050 and second largest
democracy– More children are born every day in Nigeria than in the whole of Europe
ECONOMY– GDP estimated at more than $600bn including informal economy– 70% of GDP is consumer spending – Currently ranked 22nd in GDP, projected to be top-10 by 2050– Rising urbanisation will improve economic efficiency
Seplat Energy's Nigerian opportunity 3
37bn bbl liquids
40 years reserves remaining reserves
without addition
1.6Mbopd average daily production in
2021
Source: NNPC
203 Tcf gas
Current production of 8Bscfd could
power 8GW
5GW energy could be generated from
flared gas, 15GW from reinjected gas
Source: DPR
NIGERIA’S ABUNDANT ENERGY RESOURCES
1.8 – 5.0 kWh/m direct solar irradiation
Source: World Bank
14GWTotal potential hydro
Source: World Bank
Source: IHA
Ç√
…with strong potential for growth
* Existing gas grid and off-grid diesel
Source: Wood Mackenzie Energy Transition Outlook
20402021
$468bn
57%
0.06GW
0.2GW
206m
121TWh
0.4GW
0.2GW
$973bn
85%
35.2GW
4.1GW
329m
240TWh
9.5GW
26.1GW
7.9GW
30.4GW
GDP
POPULATION
ACCESS TO ENERGY
ELECTRICITY DEMAND
TOTAL GENERATING CAPACITY*
GAS ON GRID
SOLAR ON GRID
TOTAL OFF-GRID CAPACITY
OFF-GRID GAS
OFF-GRID SOLAR
4.9GW
25.6GW
Seplat Energy's Nigerian opportunity 4
…but there are impediments
– Highest cost of energy in the world (52c/kWh) because
most power is generated by small-scale diesel and petrol
generators
– Low access to energy (57%) because of lack of grid infrastructure,
especially in rural areas
– Despite around 12.5GW installed capacity, only 4-5GW reaches
customers
– 80% of energy use is biomass for cooking
Seplat Energy's Nigerian opportunity 5
ENERGY ACCESS WILL DRIVE NIGERIA’S DEVELOPMENT
Seplat Energy's Nigerian opportunity 6
OUR STORY SO FAR
Seplat Energy's Nigerian opportunity 7
Increased oil and gas production
Seplat Energy's Nigerian opportunity 8
14,794
23,47424,252
29,003
10,091
17,853
25,669
23,935
33,714
28,54130,029
5,226
4,867
6,571
14,369
15,786
19,070
24,198
22,563
17,469
19,698
20,758
20,020
28,34130,823
43,372
25,877
36,924
49,867
46,498
51,183
48,23950,787
0
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 FY 2019 FY 2020 3M 2021 6M 2021
Increased total production by nearly 31kboepd
4x increase in gas production
Oil
Gas
boepd
Built a strong financial profile
Seplat Energy's Nigerian opportunity 9
Repaid $1.7bn debtsince IPO
$400+ million dividends Declared and paid since IPO
Invested $1.9bn capexsince IPO
Raised $2.46bn debtsince IPO
Raised $535 million equityat IPO
Built a world-class Board and governance
NON EXECUTIVE CHAIRMAN
EXECUTIVE MANAGEMENT NON-EXECUTIVE DIRECTORS
INDEPENDENT NON-EXECUTIVE DIRECTORS
Dr. A.B.C.OrjiakoNon-Executive Chairman
– Seplat co-founder
– c.25 years in Nigeria’s
O&G industry, across the
energy value chain
Arunma Oteh
– Member of the LSE
Advisory Group
– Former Treasurer and VP of
the World Bank and Director
General of SEC of Nigeria
Basil Omiyi Senior INED
– Chairman, Stanbic IBTC Holdings
– 40+ years at Shell, holding
senior roles in Nigeria and
Europe
Charles Okeahalam
– Co-founder of AGH Capital
Group
– Former Non-Executive Chairman
of Heritage Bank
Prof.Fabian Ajogwu
– Professor, Corporate Governance
Lagos Business School
– Senior Advocate of Nigeria
– Director of the Society for
Corporate Governance Nigeria
Bello Rabiu
– CEO, Dankiri Farms
– Previously 28 years at NNPC,
most recently as COO/Group
Executive Director, Upstream
Business Unit
Xavier Rolet
– Decade as CEO of the
LSE Group
– Previously CEO of CQS
and Banque Lehman Brothers
in Paris
Roger BrownCEO
– 25+ years in the O&G
industry
– Former Seplat CFO (8 yrs)
and MD of O&G EMEA for
Standard Bank Group
Emeka Onwuka CFO
– 30+ years financial
experience in the
SSA region
– Former Group MD & CEO
of Diamond Bank Plc
Engr. Effiong Okon OperationsDirector
– 29+ years of O&G
experience
– Former GM Deepwater
and Shallow Offshore
Assets of Shell Nigeria
Austin Avuru
– Seplat co-founder
– 38 years experience in the O&G, including 12 at the Nigerian National Petroleum Corporation (NNPC)
Nathalie Delapalme
– Former Inspecteur General des Finances -Ministry of Economy &
Finance (France)
– Board member at Maurel et Prom
Olivier de Langavant
– CEO of Maurel et Prom
– Formerly held various
management positions
at Total
Only Nigerian company to be listed on both the Premium Board of the NGX and the Main Market of the LSE
Seplat Energy's Nigerian opportunity 10
Strengthened and reorganised leadership
Energy for Nigeria’s future 11
DIRECTOR,
EXTERNAL AFFAIRS
& SUSTAINABILITYDr. Chioma Nwachuku
DIRECTOR,
CORPORATE SERVICES
Charles Gbandi
DIRECTOR,
STRATEGY & BUSINESS
DEVELOPMENTAlasdair Mackenzie
MANAGING DIRECTOR,
SEPLAT WESTAfolabi Folorunso
DIRECTOR,
NEW ENERGY
Yetunde Taiwo
MANAGING DIRECTOR,
SEPLAT EAST ONSHORE
Ayodele Olatunde
VICE PRESIDENT,
FINANCE
Eleanor Adaralegbe
MANAGING DIRECTOR, ELCREST
Chima Njoku
MANAGING DIRECTOR,
AGPC
Okechukwu Mba
DIRECTOR,
LEGAL & COMPANY
SECRETARY
Edith Onwuchekwa
TECHNICAL DIRECTOR
Gary Thompson
CHIEF FINANCIAL OFFICER
Emeka Onwuka
OPERATIONS DIRECTOR
Effiong Okon
CHIEF EXECUTIVE OFFICER
Roger Brown
Executive Committee
Seplat Energy's Nigerian opportunity 12
Contribution to Nigeria and its communities
Since 2010 * Includes JV share
To Nigeria
$6.2bn Revenue share
$1.1bn Royalties
$292m Taxes
$152m to NDDC and NCD
To communities *
$16.7m Other
$3.2m Education
$2.4m Healthcare
$1.8m Covid-19 relief
To Nigerians *
$4bn Local contractors
$919m Wages & benefits
– Raising entrepreneurs among
stakeholder communities to ensure
financial independence
– Socioeconomic empowerment of
women and youth
– Free and comprehensive medical support to employees and families
– Free eye care services for community
– Provision of free medical advice to pregnant community women
– Scholarship awards to community
students at secondary and tertiary
institutions
– Support to secondary school teachers
in Delta and Edo states through STEP
– Provision of potable water boreholes
for host communities
– Awareness creation among pregnant
women to promote good personal and
community hygiene practices
– Huge investments to increase gas
production to support Nigeria's gas-to-
power programme
– We supply a third of the gas needed to
provide electricity in Nigeria
– Local content policy: Employment
opportunities for local people
– Youth empowerment programs
– Conversations 4 Change partnership
– Invests in infrastructure development
within host communities
– Commissioned projects include roads,
water bore holes, rural electrification,
town halls, market stalls etc.
– We partner with communities to
provide infrastructure for improved
community life through the allocation of
quarterly Project Development Funds
to communities
– Massive investment into gas
infrastructure to reduce greenhouse
gas emissions
– We are working to stop gas flare and
ensure low-carbon future operation
– Peace building and conflict resolutions
among host communities
– Training for community development
committee members on conflict
management and dispute resolution
– Collaboration with other operators and
industry associations on SDGs
– Partnership with government,
educational institutions and
communities
– Commitment to supportive work
environment without discrimination on
gender, race, religion, physical ability,
HIV status etc.
Commitment to U.N. SDGs
Seplat Energy's Nigerian opportunity 13
Social impacts
EYE CAN SEE
3,464Eye surgeries performed
33,755Reading glasses distributed
80,585Eye disease treatments
SAFE MOTHERHOOD
38,883Programme beneficiaries
COVID-19 RELIEF
$1.8M (JV)
Seplat Energy's Nigerian opportunity 14
EDUCATIONHEALTHCARE EMPOWERMENT
SCHOLARSHIPS
3,415892 undergraduates
2,523 post-primary
PEARLS QUIZ
45,140Secondary school students
impacted
STEP PROGRAMME
143Teachers trained
ENTREPRENEURS EMPOWERMENT
162
SKILLS ACQUISITION
840Beneficiaries
VENDOR CAPACITY BUILDING
1,700Beneficiaries
Seplat Energy's Nigerian opportunity 15
Built a strong safety culture
MAN HOURS WITHOUT FATALITY OR LTI AT SEPLAT ENERGY’S WESTERN ASSETS AS AT 30 JUNE
20.5 million
FIRST NIGERIAN ACQUISITION OF A UK LISTED COMPANY
Seplat Energy's Nigerian opportunity 16
December 2019 acquisition of
Eland Oil & Gas Plc
OML 40 and Ubima
Increased 2P liquids reserves by 41 MMbbls
Increased 2C resources by 24 MMbbls
Added Sibiri exploration potential 78 MMbbl
Enabled creation of technical centre in Aberdeen
17
Introducing…
SEPLAT ENERGY
Seplat Energy's Nigerian opportunity
Our beliefs about the future
THE GREATEST BUSINESS OPPORTUNITY AHEAD OF US IS TO SUPPLY
THE RIGHT MIX OF ENERGY TO SUPPORT NIGERIA’S GROWTH. In doing so, Seplat Energy must make a positive social impact and contribute to Nigeria’s achievement of the United Nations’ Sustainable Development Goals
Seplat Energy's Nigerian opportunity 18
SEPLAT
ENERGY
OIL REMAINS
CRUCIAL
FOR NIGERIA’S
DEVELOPMENT
GAS WILL DRIVE
ENERGY
TRANSITION AND
DEVELOPMENT
RENEWABLES
ARE THE FUTURE
Hydrocarbon export will continue to be a
mainstay of the Nigerian economy and will
fund Nigeria’s growth as well as its energy
transition
Seplat Energy has a role to play as a
responsible steward of Nigeria’s oil and gas
assets, including those that might be
divested
Lower-emission hydrocarbons, particularly
gas, have a role to play during energy
transition by replacing diesel generators and
biomass
In the longer term, the reality and threat of
climate change requires the decarbonisation
of energy systems in Nigeria
We support the goals of the Paris Agreement
and are in step with society’s objective to get
the world to net zero carbon emissions by
2050, if not before
Sustainability and transparency must be at
the heart of Seplat Energy’s business
operations and decision making
Nigeria’s energy transition journey
Increase energy access to achieve universal coverage and drive social and economic development
Seplat Energy's Nigerian opportunity 19
1Achieve a ‘Just Transition’ using Nigeria’s gas resources to replace imported diesel, reducing economic burden, improving GDP and reversing FX drain
2Increase use of renewables to exploit abundant sunlight, wind and hydro resources3Reduce greenhouse gas emissions to meet the 2050 Paris objectives, and reduce particulate pollution from diesel and biomass
4Transition cooking from firewood to gas, preserving the natural environment and reducing deforestation5
Our energy transition priorities
Seplat Energy's Nigerian opportunity 20
Achieve sustainable long-term growth by providing the optimal energy mix for Nigeria1Be a national energy champion and partner of choice to support Nigeria’s energy transition2Drive social and economic development through direct and indirect efforts3Prepare for a lower-carbon world requiring different products and skills4Achieve significant reductions in corporate emissions5
Our strategic framework
Seplat Energy's Nigerian opportunity 21
ENABLED BY STRONG GOVERNANCE
STRATEGY
BUILD A SUSTAINABLE BUSINESS DELIVER TRANSITION
UpstreamSocial development
Midstream GasEnvironmental care
New EnergyFinancial returns
Increasing
access to energy
Reducing
emissions
Transforming
the economy
VALUE – INTEGRITY – PARTNERSHIP
SAFETY
Build a sustainable businessOur key priorities
Seplat Energy's Nigerian opportunity 22
KEY INITIATIVES:– Increase community employment and content– Foster local entrepreneurship– Improve healthcare and education– Improve access to energy in local communities
DRIVE
SOCIAL DEVELOPMENT
Make a positive impact on communities through
improved access to energy, opportunities for local
employment and suppliers, and initiatives that
foster entrepreneurship, education, health and
resilience.
KEY INITIATIVES:– Achieve significant reductions in emissions– Establish comprehensive ESG baseline
to guide policies and targets for reduction – Report Scope 1-2 carbon emissions in 2021
Annual Report – Report under TCFD framework in 2021 Annual
Report– Develop policies for biodiversity and water
FOCUS ON ENVIRONMENTAL
CARE & REPORTING
Minimise our impact on local and global
environments, drive improvements where possible,
commit to global standards and transparently
report our progress.
KEY INITIATIVES:– Remain the partner of choice for efficient
and responsible stewardship of Nigeria’s hydrocarbon assets
– Diversify the business against oil price volatility – Maintain prudent cash and debt management
strategy– Drive growth through astute capital allocation– Return cash to shareholders
MAXIMISE RETURNS FOR
ALL STAKEHOLDERS
Manage our finances prudently, pay our share of
taxes and royalties, service debt, invest for the
future, and return dividends to shareholders.
VALUE – INTEGRITY – PARTNERSHIP
SAFETY
Deliver transition Our key priorities
Seplat Energy's Nigerian opportunity 23
KEY INITIATIVES:– Monetise reserves– Diversify export routes– Operational efficiency– Cost control / Technology– Decarbonise field operations – End routine flares– Asset integrity & safety– Efficient project delivery
UPSTREAM
Develop our Upstream business by selectively
expanding our asset base, optimising the gas/oil
mix, increasing production, reducing costs and
carbon intensity, and increasing revenue
assurance by diversifying routes to market.
KEY INITIATIVES:– Higher utilisation of existing gas plants– Deliver ANOH– Develop new gas markets– LPG– CNG for automobiles
MIDSTREAM GAS
Development of Nigeria’s gas resources to
accelerate the replacement of diesel and biomass
and support economic growth through the supply
of reliable, low-cost energy. Gas-to-power provides
baseload electricity to support renewables.
KEY INITIATIVES:– Selective entry to power generation market – Combine gas with solar– Explore carbon offset markets– Ensure continued access to capital
NEW ENERGY
Achieve a world-class capability in renewable
energies, through the development or acquisition
of new skillsets that open up new and profitable
markets.
VALUE – INTEGRITY – PARTNERSHIP
SAFETY
DRIVING SOCIAL DEVELOPMENT
GOAL
Make a positive impact on communities through
improved access to energy, opportunities
for local employment and suppliers,
and initiatives that foster entrepreneurship,
education, health and resilience
Seplat Energy's Nigerian opportunity 25
Partnerships with the communityStrong partnerships for mutual benefit, governed by GMOU
GENERAL MEMORANDUM
OF UNDERSTANDING
• Signed with host communities
• Defines relationship and obligations between
Seplat Energy and its hosts
• Focused on:
• Capacity development
• Improving essential infrastructure e.g.
electricity, health centres, schools,
water projects
• Economic empowerment including
FTO payment
• Open and regular two-way dialogue
for relationship management
• Use of locals to ensure first level of pipeline
& wellhead security
• Grievance management mechanism
and peace building; security support
& Peaceful Community Awards
• Environmental stewardship
• Funds disbursed quarterly through dedicated fund
Social Investment– Aligned with U.N. SGDs and Africa Union 2063 goals particularly in health, education, economic empowerment,
environmental care
– Health intervention programme: Eye Can See & Safe Motherhood
– Road and drainage construction; skill acquisition for Seplat other (non-host) communities
– Education: PEARLs Quiz and scholarships, Seplat Teachers Empowerment Programme (STEP)
Local employment– Direct employment of locals – Employment of locals through contractors to provide service – Employment of locals as vendors personnel – Community labour as part of community content labour for major projects
Encouraging local entrepreneurs– Training, mentoring and empowerment of young entrepreneurs in partnership with Conversations 4 Change (C4C)– Entrepreneurship training programme– Community vendors capacity development programme– Support of community vendors partnership with more technically competent contractors – 10% above bid price rule advantage for community vendors
Statutory Interventionist Agencies funding– Seplat Energy pays statutory contributions to government agencies– Niger Delta Development Commission: 3% of annual budget– Nigerian Content Development Levy: 1% of contract value– Tertiary Education Tax: 2% of assessable profits
Seplat Energy's Nigerian opportunity 26
FOCUSING ON ENVIRONMENTAL CARE AND REPORTING
Current ESG ratings improvingSteady progress in reducing ESG risk, enhancing performance and reporting
Seplat Energy's Nigerian opportunity 28
26-03-21
0 1 2 3 4 5 6 7
Business Ethics
Resource Use
Land Use and Biodiversity
Bribery & corruption
Human capital
Community relations
Occupational Health & Safety
Corporate governance
Emissions, Effluents and Waste
Carbon - products and services
Carbon - own operations
SUSTAINALYTICS ESG RISK RATING
RISK LEVEL
High
Medium
Low
Negligible
31st / 171 E&P companies rated
GOAL
Minimise our impact on local and global environments,
drive improvements where possible, commit to global standards
and transparently report our progress
Seplat Energy's Nigerian opportunity 29
ESG: from baselining to reporting
– ESG performance and reporting is an ongoing project built on
10 years of effort
– Historic and current data will be used to calculate a baseline
for 200+ ESG metrics across the business
Enhancing ESG performance and reporting is a priority, but first we must establish baselines and develop targets
– We plan to publish Scope 1&2 emissions, TCFD and CDP
disclosure in 2021 Annual Report
– Future disclosures driven by policies / data
– Adopt integrated reporting for 2021 annual report
Seplat Energy's Nigerian opportunity 30
Establishing
a baseline
Reporting our
performance
– Baseline will be used to determine short and long-term ESG
targets, to be achieved through existing and new ESG initiatives
including Net-Zero, Scope 1&2 emissions reduction targets,
biodiversity plan, etc
Setting
targets
MAXIMISING RETURNS FOR ALL STAKEHOLDERSEmeka Onwuka Chief Financial Officer
Seplat Energy's Nigerian opportunity 31
GOAL
Manage our finances prudently, invest
for the future, pay our share of taxes
and royalties, service debt, and return
dividends to shareholders.
Seplat Energy's Nigerian opportunity 32
Responsible stewardship of assets
23,474 24,252
29,003
10,091
17,853
25,669 23,935
33,714
30,028 4,867
6,571
14,369
15,786
19,070
24,198
22,563
17,469 20,758
28,34130,823
43,372
25,877
36,923
49,867
46,498
51,183 50,786
0
10,000
20,000
30,000
40,000
50,000
2013 2014 2015 2016 2017 2018 2019 2020 6M 2021
Increasing gas volumes for growing market needs (boepd)
Gas
Oil
Financial discipline has enabled Seplat Energy to manage Nigeria’s resources through difficult times
$169.5$285.3 $326.0
$159.6
$437.2
$584.7
$333.0$258.7 $298.8
-$310.3 -$588.2 -$899.6 -$664.1 -$570.1 -$445.7 -$789.4 -$698.4 -$755.2
-$456.4
-$1,000
-$800
-$600
-$400
-$200
$0
$200
$400
$600
$800
2013($108.6)
2014($99.0)
2015($53.0)
2016($45.1)
2017($54.7)
2018($71.3)
2019($64.0)
2020($39.9)
6M 2021($63.8)
Prudent cash and debt management ($m)
Cash ($m)
Gross debt ($m)
Net cash/debt
COVID-19 (Mar 2020 to date) Trans Forcados force majeure (Feb 16 – Jun 17)Oil price crisis (Jul 14 – Jan 16)
862
748
494
149
318
591
495
418
245
18
27
77
106
124
156
202
113
64
0
100
200
300
400
500
600
700
800
900
1,000
2013 2014 2015 2016 2017 2018 2019 2020 6M 2021
Diversified revenue reduces exposure to oil price volatility ($m) Gas
Oil
120
321
152
5233
88
125
150
57.5
$0
$50
$100
$150
$200
$250
$300
$350
2013 2014 2015 2016 2017 2018 2019 2020 6M 2021
Flexibility with capital investment ($m)
Seplat Energy's Nigerian opportunity 33
21%
gas
21%
gas
29%
gas
21%
gas
28%
gas
42%
gas
13%
gas
3%
gas
2%
gas
Focus on cash generationMulti-pronged approach ensures strong cash position
Seplat Energy's Nigerian opportunity 34
– Focus on asset integrity and safety– Good community relationships
minimise disruption– Diversify export routes to reduce
downtime, losses– 80% of revenue is FX
– Increase gas in revenue mix for improved visibility, higher cash drop-through, natural hedge against oil
– Hedging policy
Revenue assurance
– Low-cost producer targeting further reduction to $9.10 / boe
– Breakeven at $15.50 enables profitability at low prices
– Improve operational efficiency, deploy innovation
– Reduced barging costs, renegotiated contracts
– Responsive to market conditions
– Efficient cash conversion
– Fully fund organic business from cash
– Able to increase or decrease capex when needed
– Take advantage of high cash position for dividends, M&A
Cost reduction
Flexible capital allocation
Gas
Invest in gas as transition fuel
Develop ANOH for long-term
growth
Drill gas wells to serve
demand
Oil
Offset decline by developing
low-risk wells / prospects
Sustain and optimise
production
Focus on projects offering
most rapid returns
Capital allocation prioritiesWe focus on low-risk strategies to grow the business and improve stakeholder returns
Seplat Energy's Nigerian opportunity 35
Maintain dividend payouts and
consider progressive dividend
policy on stable gas revenues
Quarterly payment
Buybacks also possible
Significant retained earnings
balance of $1.1bn as at June
2021 ($68 cents/share)
Declared more than $400
million in dividends since
$535m raise at IPO in 2014
Maintain net debt at less than
3x EBITDA through the cycle
Reduced financing costs with
successful issue of $650
million 7.75% senior notes to
redeem existing $350 million
9.25% senior notes
Repaid $250 million drawn on
$350 million RCF, so $350m
available
Refinanced $100 million
Westport RBL facility
Maintain cash balance
>$100m
High credibility with lenders,
good credit rating
Opportunities to consolidate
Nigerian market though IOC
divestments, OMLs etc.
Opportunities to strengthen
upstream gas position and
expand along gas value chain
Priorities include onshore
Nigeria, gas, shallow water,
partnerships
Other opportunities and
partnerships to broaden
energy mix
Low-risk capex Return cash to investors Balance sheet strength Value-creating M&A
– $300m cash at bank
– $350m available on RCF
Building financial firepower
Seplat Energy's Nigerian opportunity 36
Available $650m liquidity
– Trusted partner to FG on strategic projects e.g. ANOH
– Evidenced by progressive reduction in receivables
– Solid credit ratings (Fitch: B- Positive; Moody’s: B2 Negative; S&P Global: B Stable)
– Borrowed $2.46bn since IPO
– Repaid $1.7bn (69% of borrowings)
– Net debt / EBITDA well within covenants
High credibility
Track record
of debt management
6M 2021 highlightsSix months to 30 June 2021
Seplat Energy's Nigerian opportunity 37
0.8%
50,786 boepdVolumes within guidance
6M 2020: 51,178 boepd
PRODUCTION
$309 million6M 2020: $234 million
TOTAL REVENUES
$299 millionFY 2020: $259 million
CASH AT BANK
80%
$64.69 / bblOil price recovered strongly, averaging $63.8/bbl
6M 2020: $35.94
REALISED PRICE
$179 million6M 2020: $126 million
EBITDA
$456 millionFY 2020: $440 million
NET DEBT4%
$9.7 / boeContinuous focus on costs
6M 2020: $7.6 / boe
UNIT OPERATING COSTS
$62 million6M 2020: ($145 million)
PRE-TAX PROFIT
34%
$57 million6M 2020: $86 million
CAPITAL INVESTMENT
28%
32% 42%
15%
BREAK
– Delivering transition
– Upstream
– Midstream Gas
– New Energy
– Q&A
18.00
RECEPTION
16.20 – 17.30
Seplat Energy's Nigerian opportunity 38
UPSTREAMEffiong OkonOperations Director
GOAL
Develop our Upstream business by selectively
expanding our asset base, optimising
the gas/oil mix, increasing production,
reducing costs and carbon intensity,
and increasing revenue assurance by
diversifying routes to market.
Seplat Energy's Nigerian opportunity 40
Portfolio development - oil
Seplat Energy's Nigerian opportunity 41(1) Assessed independently by Ryder Scott, as at 1 January 2021
Gulf of
Guinea
OML53
OML40OML4
OML41
OML38
OPL283
OML55
Ubima
FORCADOS
TERMINAL
ESCRAVOS
TERMINAL
BRASS
TERMINAL
BONNY
TERMINAL
WARRI
REFINERY
WARRI
SIBIRI ABIALA
GBETIOKUN
NEMBE
PORT HARCOURT
INDA
OBEN
OKPORHURU
OROGHO
OPUAMA
JISIKEUMUSETI
IGBUKU
IDAMA
ROBERTKIRI
OWERRI
OHAJI
SOUTH
ASHAKA
OVHOR
AMUKPENIGERIA
RAPLE
LACT UNIT
SAPELE
NIGERIA
New Export Pipeline
– Key assets OMLs, 4, 38 & 41 have access to export routes through the Forcados Oil Terminal (FOT) and at the Warri Refinery
– Completion of the AEP will further diversify export routes
– OML 40 export via the Trans Escravos Pipeline (TEP) to FOT
Expected Onstream
Amukpe-Escravos Pipeline (AEP) H2 2021
Oil business:
AVERAGE 2020 WIOIL PRODUCTION
OMLs 4, 38 & 41 OPL 283 OML 53 OML 55 OML 40 Ubima
AVERAGE 2020 WI OIL RESERVES
33,714bopd
241MMbbls
53Total number of oil wells to be
drilled in the 5-year Plan
OMLs 4, 38 & 41 26
OML 53 7
OML 40 15
OPL 283 1
Ubima 4
160 MMbblsEstimated total liquid reserves
to be produced by 5-year plan
Five-year plan for oil
– Assets close to major demand centres, enabling Seplat to capitalise on the domestic gas supply opportunity
– We believe the ANOH development at OML 53 is one of the largest greenfield gas and condensate developments in the Niger Delta
Portfolio development - gas
Seplat Energy's Nigerian opportunity 42(1) Assessed independently by Ryder Scott, as at 1 January 2021
4Q3
Escravos Terminal
Forcados Terminal
Brass Terminal
Bonny Terminal
EA
ELOPS
Gulf of
Guinea
OML40
OML4
OML41
OML38
OPL283
OML53
Ubima
OML55
Oben
Azura IPP
Eyean
(Pan Ocean / CN)
Sapele
(SPDC)
Papalanto (CNL)
Omotosho (CNL)
ELPS
Sapele
Jones Creek
Odidi
Delta
III / IV
NGMP CPF
Warri
Okpokunou
Bemadi
Iseni
Ogara
Utorogu
Uzere
Eriemu
Ughelli
Biseni
Koroama
Gbaran
/ Ubie
Bayelsa (SPDC)Kolo
Creek
Obite (EPNL)
Zarama
Obite
(EPNL)
Obiafu
Rumuji
Imo River
SokuCawthorne
Channel
Obigbo
Afam V
Afam VI
Okoloma
Notore
Alakiri Ibom /
Ikot Abasi
(SPDC)
Alscon
Utapate
Bonny (XOM)
Alaoji (SPDC) Calaber (Addax)
ANOH
Egbema (Addax / NPDC / SPDC)
Egbema
Abuja
Ajaokuta Steel
Geregu (SPDC)
Quantum
Lagos Industry
Wagp
Egbin/AES
Agura (CNL)
NIGERIA
OBEN HUB
ANOH HUB
Agbada
Existing Power/Industries
Cluster CPF/Gas Supply Field
Key Future Gas Supply Field
Existing or Oil Development
Existing Domgas Supply
NGMP CPF
Existing Domgas Pipeline
New Domgas Pipeline
Expected Completion
OB3 Pipeline H2 2021
ANOH Gas Project H1 2022
Gas business:
2P WI GAS RESERVES1
OMLs 4, 38 & 41 OPL 283 OML 53
AVERAGE 202 WIGAS PRODUCTION
101MMscfd
1,501Bscf
Five-year plan for gas
19Total number of gas wells to be
drilled in the 5-year Plan
OMLs 4, 38 & 41 11
OML 53 6
OPL 283 2
1.5 TcfEstimated total gas reserves
to be produced by 5-year plan (c. 260MMboe)
Five-year investment programmePlan is to invest $0.9bn to $1.2bn in existing assets, funded by cash flow *
Seplat Energy's Nigerian opportunity 43
47%
30%
12%
9%2%
INVESTMENT BY ASSET (%)
OML 4, 38, 41
OML 40
OML53
OML 17
OML 56
58%
42%
INVESTMENT BY ACTIVITY (%)
Drilling
Facilities
76%
24%
INVESTMENT BY BUSINESS (%)
Oil
Gas
*Subject to market conditions, excludes New Energy or power generation
Reserves replacement
Seplat Energy's Nigerian opportunity 44
WESTERN ASSETS EASTERN ASSETS ELANDTotal
(29 prospects & leads)
Largest Prospect Total
(29 prospects & leads)
Largest Prospect Total
(24 prospects & leads)
Largest prospect
Oil
(MMstb)
Gas
(Bcf)
Oil
(MMstb)
Gas
(Bcf)
Oil
(MMstb)
Gas
(Bcf)
Oil
(MMstb)
Gas
(Bcf)
Oil
(MMstb)
Gas
(Bcf)
Oil
(MMstb)
Gas
(Bcf)
In place
(Risked) 385 1763 124 327 914 862 246 163 432 0 74 0
Recoverable
(Risked) 135 1410 43 262 320 690 86 130 173 0 30 0
— Focus on monetising reserves balanced by disciplined approach
to investment in additional assets
— Drive operational excellence to accelerate revenues from wells
— Ongoing projects to convert 94.8MMboe 2C resources to 2P reserves
— Assess M&A opportunities to increase reserves base
— Plan to increase 2C resources (see table)
1. Forcados Terminal— Historically the primary export terminal
for OMLs 4, 38, 40 and OPL 283
— Reliant on 3rd-party operated Trans Forcados
Pipeline to transport oil
2. Warri Refinery— Alternative route established in mid 2016
while Forcados under force majeure
3. Escravos Terminal — New 160,000 bopd Amukpe-Escravos Pipeline to
connect OMLs 4, 38 and 41 to Escravos Terminal
— Seplat Energy entitled to 40,000 bopd
— Underground, more secure pipeline
4. Brass Terminal— Export terminal for Jisike (OML 53) and OPL 283
5. Bonny Terminal— Export terminal for Ohaji-South (OML 53) and
OML 55 crude
6. Waltersmith Refinery— Alternative route for OML 53 crude
7. OPAC Refinery — Planned alternative route for OPL 283 crude
Diversifying export routesImproves revenue assurance by reducing impact of downtime, shut-ins
Seplat Energy's Nigerian opportunity 45
Amukpe-Escravos opens new possibilities– Seplat Energy’s major assets, OML 4, 38, 41, currently export via
unreliable Trans Forcados Pipeline
– TFP downtime was 18% for 6m 2021, with 12% reconciliation losses
– Amukpe-Escravos pipeline projected operational September
– First lifting expected in Q4
– Seplat Energy can send 40kbpd liquids through AEP from OML 4, 38, 41
– AEP opens up three possible new export routes we can develop, detailed opposite
– Would enable combination of liquids from OML 40 with those of OML 4, 38, 41
Seplat Energy's Nigerian opportunity 46
Options available from AEP Advantages
1. AEP to Escravos Terminal Reduces losses and deferments vs TFP
2. AEP to NPSC Tank System Reduces tariff by not exporting through Chevron
3. AEP to FOT
(via the Otumara manifold & TEP)Reduces losses and deferments vs TFP
4. AEP to FSO
(via the Otumara manifold)Reduces losses and deferments vs TFP
Increase production and reduce cost per boe1. Current projects
Seplat Energy's Nigerian opportunity 47
Project Cost reduction initiatives
WESTERN
ASSETS
Amukpe LTF and facility
upgrade projectSignificantly reduce the crude handling charge by
removing 99.5% of water
Pumps Replacement Increase evacuation capacity of crude oil/produced
water evacuation pumps
EASTERN
ASSETS
Ohaji-South Central
Processing FacilityInstall 30Mbopd Central Processing Facility by 2023, to
end the current lease of the Ibigwe Early Processing
Facility
Jisike Debottlenecking Increase handling capacity from 10 kbpd to 15 kbpd
Install 6 MMscfd AG compressor to optimise gas lifting
of oil wells and reduce flaring
ELAND Gbetiokun Pipeline Eliminate high barging costs and downtime risk through
construction of a 12” 30km pipeline from Gbetiokun field
to Adagbassa manifold
Gbetiokun and Opuama
Water Management FacilityReduce water handling charges from both the
Gbetiokun and Opuama fields
Current production opex per boe
$9.70
Target production opex per boe
$9.10
Increase production and reduce cost per boe
Maximise efficiency by deploying innovation — Use of business technology mapping to screen, evaluate and rank
technologies according to value drivers
Examples of achievements
Remote monitoring
— Improves well performance and availability to more than 90% uptime
Seplat Virtual Asset Management technology
— Ensures 95% plant and equipment availability
Wax mitigation technology
— Achieved 50% reduction in dewaxing / hot-oiling cycle, thereby accelerating return to production
2. Deploying innovation
INNOVATION SCREENING AND APPLICATION
Seplat Energy's Nigerian opportunity 48
Remote monitoring and surveillance
Production automation Software integration
Integrated asset modelling Machine learning Fiber optics
Data driven IOT Analytics Smart well Change management
OptimisationTelemetry Integration Visualization
Artificial intelligence Virtual asset management
Operational profitability
Asset integrity
Profitability
HSE
Technology value drivers
— Around 90% of Seplat’s Scope 1 and 2 emissions
come from flaring of associated gas— Fugitive emissions and in-field use are small by
comparison
— We plan to end routine flaring by 2024 — Nigeria is committed to ending
routine flares by 2030
— Focus will be on maximising gas-to-grid
as lowest cost / complexity option— Capture and monetise gas for productive use
— Drive LPG production to replace biomass for cooking
Seplat Energy's Nigerian opportunity 49
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
Other Fugitiveemissions
Mobile emissions Stationaryemissions
Flare gas Purchasedelectricity
Scope 1 Scope 2
Q1 2021 SCOPE 1 AND 2 EMISSIONS (EXCLUDES ELAND ASSETS)
Ending routine flares
KEY FLARES OUT PROJECTS
CO
2to
nn
es e
qu
iva
len
t
Decarbonising field operations
— Aside from ending routine flares, we are looking
for other ways to decarbonise our operations
— Replacing diesel with LPG or LNG will
reduce emissions by 5% - 14%
— Onsite solar could achieve 40% reduction
but would probably need gas/diesel back-up
if suitable battery options not available
Seplat Energy's Nigerian opportunity 50
0
2,000
4,000
6,000
8,000
10,000
12,000
Main Emergency
kV
A
POWER GENERATION BY FUEL (EXCLUDING ELAND ASSETS)
Diesel
Gas
-45%
-40%
-35%
-30%
-25%
-20%
-15%
-10%
-5%
0%
Heavy Gas Oils Liquified Petroleum Gas(LPG)
Natural Gas Solar
POTENTIAL EMISSION REDUCTIONS FROM USING ALTERNATIVES TO DIESEL
Source: Wood Mackenzie
Seplat Energy's Nigerian opportunity 51
Focus on asset integrity
AIPSM awareness and facility monthly
status reports
Impressive regulatory compliance
AIPSM policies and procedures
Created AIPSM culture across the organization
Meeting minimum
standards
100% regulatory
compliance
ISO 55001 Certified with full implementation
of ISO requirements /standards
Improved reliability and availability of
facilities
Reduction in process safety incidents
Reduction in
maintenance costs
Embedded AIPSM
culture
2010-2018
2019
2021
2023
Key elements
Technical Integrity Risk Assessment
Design Integrity Incident Management
Well Integrity Training and Competence
Operational integrity Monitoring and Audit
Leadership and Behavior Performance Measures
Safe Operations
ASSET INTEGRITY & PROCESS SAFETY MANAGEMENT (AIPSM)
– Increase revenue assurance and profitability
– Increase assets’ life span– Reduce deferment by
c.120kbbl annually – Improve reliability and
availability of facilities
MIDSTREAM GASYetunde TaiwoDirector, New Energy
GOAL
Development of Nigeria’s gas resources to accelerate the replacement of diesel and biomass and support economic growth
through the supply of reliable, low-cost energy. Gas-to-power provides baseload electricity
to support renewables.
Seplat Energy's Nigerian opportunity 53
Nigeria’s gas utilisation challenge NIGERIA HAS HUGE RESOURCES OF NATURAL GAS, ESTIMATED AT 203 TCF, OR 5.3 TRILLION CUBIC METRES, ABOUT 2% OF GLOBAL GAS
RESERVES AND 37% OF KNOWN AFRICAN GAS RESERVES, BUT NIGERIA’S GAS INDUSTRY AND INFRASTRUCTURE IS RELATIVELY UNDEVELOPED
Seplat Energy's Nigerian opportunity 54
Gas export
Gas reinjection
Local supply (other)
Flared gas
Fuel gas
Gas lift make-up
Local supply (power)
HGL/LPG feed gas
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
HOW NIGERIA USES GAS AT PRESENT
Source: Nigerian Oil & Gas Industry Annual Report, Department of Natural Resources (2018)
0
5
10
15
2020 2040
DEVELOPMENT OF GAS POWER CAPACITY
On-grid gas (GW) Off-grid gas (GW)
Nigeria flares as much gas as it uses for electricity
generation, but this gas can be captured and put to
economic use.
The 2017 National Gas Policy sets out to transition
Nigeria from being a crude oil export-based
economy to becoming an attractive gas-based
industrial economy.
Government policy is also focused on addressing
the undersupply of gas and extending access to
electricity.
Nigeria seeks a “just transition” that enables it to
use its abundant gas resources for the benefit of its
people.
Wood Mackenzie forecasts power generation from
gas to grow from 5.1GW to 13.6Gw by 2040.
Benefits of gas in Seplat Energy portfolio
BUILDING MARKET STRENGTH — Increase utilisation of Oben gas processing plant
— ANOH gas processing plant will add 300mmscfd gross new processing
capacity from H1 2022, raising total gross capacity to 765MMscfd
— OB3 pipeline will connect Oben and ANOH to Abuja and Lagos when
completed later this year
— New 75mmscfd Sapele Gas Plant now expected in 2023
ENHANCING CASH FLOWS AND VISIBILITY — The gas business provides revenue and cash flow stability, acting
as a hedge against fluctuation in oil prices
— Superior earnings quality from higher cash drop-through, given lower
royalties on gas, lower tax rate, and cost allocation to oil operations
— Long-term offtake contracts improve earnings visibility
— More secure transport than oil, meaning fewer losses
— Ability to sell above DSO price once DSO commitments
have been met
— Diversified regional customer base helps to mitigate risks associated with
the Nigerian domestic gas market
Gas provides visibility, higher profitability and hedging against oil
Seplat Energy's Nigerian opportunity 55
2939
8695
114
145
131
101
120
1827
77
106
124
156
202
113
64
0
50
100
150
200
250
0
30
60
90
120
150
2013 2014 2015 2016 2017 2018 2019 2020 6M 2021
GAS PERFORMANCE (MMSCFD) AND REVENUES ($)
1.7
1.9
2.6
3.0 3.0 2.92.8 2.9
109
99
5244
52
7264
42
1.0
1.5
2.0
2.5
3.0
3.5
2013 2014 2015 2016 2017 2018 2019 2020
GAS PROVIDES A NATURAL HEDGE AGAINST OIL PRICE VOLATILITY ($)DSO GasPrice
Seplat Avg.CommercialGas Price
Oil Price(Brent)
MM
scfd
$
Deliver ANOH
COMMERCIAL & FUNDING
– Completed funding with $260m loan (plus accordion)
in February 2021
– Condensate offtake agreement with Vitol signed April 2021
GAS PLANT DELIVERY PROGRESS:– Installation phase underway– Power and rotating equipment undergoing customs clearing– All process equipment shipped and scheduled to arrive Nigeria
by end of July; process equipment foundations completed– Shell has commenced drilling of the upstream wells
to supply the ANOH gas plant
On track to deliver first gas in H1 2022
Seplat Energy's Nigerian opportunity 56
202220212019 2020
DESIGN & PROCUREMENT MANUFACTURING INSTALLATION COMMISSIONING
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
Q1 19Final Investment
Decision
Q1 21Equipment
shipped
Q2 22First gas
Q4 21Mechanical
Completion
50%
50%
AGPCOML 53NNPC 60%
Seplat Energy 40%
Seplat
Energy
50%
Dividends
NGC
50%
Dividends
Seplat
Energy 50%
NGC 50%OML 21Shell 30%
NNPC 55%
Others 15%
55
0M
Mscfd
pro
duced
Upstream supply
50-50 joint venture combining
OML 53 and OML 21
Seplat Energy receives income from AHOH in two ways:
Wet gas sales to AGPC275 MMscfd
Dry gas250 MMscfd
Condensate19,800 bpd
LPG1,230 bpd
Wet gas
sells to
NNPC
Wet gas price per MMscfd
=Wet gas cost / gas quantity
(where wet gas cost = 0.35x DSO gas sales revenue
+ 0.5x LPG sales revenue + 0.5x condensate sales revenue)
Seplat Energy has 40% revenue share of gas sold to AGPC
27
5M
Ms
cfd
wet
ga
sp
roc
essed
Reve
nu
es
fro
mo
ffta
ke
s
Le
ss
co
sts
&m
ain
ten
an
ce
ca
pex
40%share of wet
gas sales
50%of dividends
from AGPC
AGPC Sales
+
ANOH financial model
Seplat Energy's Nigerian opportunity 57
Scalable opportunity in domestic gas Government sees gas as the transition fuel and plans to improve the market
58
OPPORTUNITY
OVERVIEW1. Capitalise on infrastructure capacity growth and secure
additional domestic gas market share
2. Partner with industrial customers and sell gas for use in
industry as part of long term supply contracts
POLICY
SUPPORT– ‘Decade of Gas’ sends a clear signal to industry that the government sees
the gas market as critical to Nigeria’s future
– The Nigeria Gas Flare Commercialization Programme has been enacted
to drive additional sales of gas to grid
– Gas provisions in the PIB will promote infrastructure expansion
TECHNICAL
FEASIBILITY– Infrastructure build-out can open up new demand centres
COMPETITIVE
EDGE– Through its involvement with ANOH and its track record of meeting its
DSO, Seplat Energy has a strong reputation as a domestic gas supplier
and has established partnerships with NGC
Remaining dry gas sent to grid or to industry
Dry gas
NGLs used for polyolefins
Send gas to processing facilities to separate out NGLS for sale to petchems
industry
Wet gas
Dry gasSell gas direct to grid
Seplat Energy's Nigerian opportunity
Source: Wood Mackenzie
Our focus on new marketsNew gas markets provide significant additional future revenue potential
Seplat Energy's Nigerian opportunity 59
GAS TO POWER
• Industrial parks, large manufacturing plants,
universities, hospitals etc
• 2017 Directive on Eligible Customers allows power
generators to supply directly to customers or
groups of customers with loads of at least 2 MW
• Wood Mackenzie estimates that captive gas
generation capacity can grow to over
4 GW by 2040
• Gas supports development of industry
in Free Trade Zones
• Possible entry strategies:
• Build / acquire pipelines
• Build / acquire power generation capability
GAS PRODUCTS
• Potential to displace extensive amounts
of biomass used for cooking by most households,
c.110 Mtoe in 2020
• LPG cooking gas is a rapidly growing
segment, estimated at 1.1 Mtoe (1.3 bcm)
in 2020
• Wood Mackenzie forecast demand to increase at
a CAGR of 7.6% to reach 5.5 bcm in 2040,
equates to 7m tonnes.
• Other opportunities in CNG for automobiles
• Possible entry strategies:
• JV or acquisition
Extend dominance of the gas market
Seplat Energy's Nigerian opportunity 60
Seplat EnergyPipeline
Power stationDistribution
companies
$0.03/
kWh
Upstream
Gas
Nigeria Bulk
Energy Trading
Electricity cost
to final
consumer
$0.10/
kWh
$0.15/
kWh
Currently, Seplat Energy has
access to only $0.03/kWh
(about 20%) of the $0.15/kWh
that could be derived from
the on-grid value chain
Off-Grid Gas Value Chain
Seplat EnergyPipeline
Power station
Distribution
companies
$0.03/
kWh
Upstream
Gas
Electricity cost
to final
consumer
$0.29/
kWh
Off-Grid Diesel
Exported crudeImported
dieselFuel vendors
Upstream
Oil
Diesel cost to
final consumer$0.52/
kWh
This potential value addition
could substantially increase
to $0.29/kWh with off-grid
electricity supply
Due to the high costs of diesel
generated energy, there are lower
switching costs for gas to power,
even for off-grid
On-Grid Gas Value Chain
c$80bn
pa
Capture additional value along the value chain
NEW ENERGY
GOAL
Achieve a world-class capability
in renewable energies, through
the development or acquisition
of new skillsets that open up
new and profitable markets
Seplat Energy's Nigerian opportunity 62
Solar offers solid growth potentialRequires capability building but offers long-term revenue visibility
in a market underpinned by world-leading policy
Seplat Energy's Nigerian opportunity 63
Opportunity
overview
1. Create off grid solar power distribution business to supply;
• Commercial and industrial (C&I) sector
• Micro-grid
2. Create supply and installation business for solar home systems
Policy
support
– Aggressive public sector support puts Nigeria at the top of Wood
Mackenzie’s global solar policy rating through its National Electrification
Project (NEP)
– World Bank and African Development Bank promoting off-grid solar to increase
access to electricity across Africa
Technical
feasibility
– Need to build our capability in solar and off-grid markets
– Moving into the supply and installation business requires new skillsets
Competitive
landscape
– Primary value for C&I solar in Nigeria is diesel displacement. The Federal
Government recently repealed the diesel subsidy and doubled power prices
nationally, making the value proposition for onsite solar highly attractive.
– Wood Mackenzie expects the currently 36 active developers and their future
competitors to install 775 MW of C&I solar capacity across Nigeria by 2025.
POTENTIAL CONSUMERS
Supply solar power to small off-grid communities
Supply power to commercial and industrial customers and displace diesel generation
Supply solar home systems to residential customers not grid connected
Utility-scale solar
SOLAR PV DEVELOPER
Source: Wood Mackenzie
Nigeria’s off-grid solar marketProjected to be worth nearly $17 billion by 2040
Seplat Energy's Nigerian opportunity 64
Indicative costs
$0.29/kWh
2020 capacity
0.1 GW
Indicative costs
$0.52/kWh
2020 capacity
20 GW
Off-grid solar market
Total off-grid solar
capacity growth
(2020-2040)
Based on additional capacity
above current 2020 levels26 GW
Market growth
CAGR (2020-2040)
Expected growth of off-grid
solar capacity 26%
Indicative power
prices
Based on estimate of off-grid
power prices$0.29/kWh
Total addressable
market
Based on expected capacity
and prices
2020 - $0.11 bn
2040 - $16.9 bn
Source: Wood Mackenzie
Concluding, our future ambitions:
Seplat Energy's Nigerian opportunity 65
Selectively enter power generation through gas-to-power and renewables
Expand into new gas markets and infrastructure
Acquire significant and attractive divested assets
Invest $0.9bn - $1.2bn capex in existing assets
Increase energy access to drive social and economic development
Maintain dividend payouts and consider progressive dividend policy
Minimise environmental impact, drive improvement, report transparently
Q&A
THANK YOU
APPENDIXFinancial information
6M 2021 performance updateProduction within guidance and improved on 3M 2021
Seplat Energy's Nigerian opportunity 69
W.I. 2P reserves *
MMboe
W.I. production
6M 2021 boepd
Block Share Partner Oil Gas Total Oil Gas Total
OML 4, 38, 41 45% NPDC 156.0 119.5 275.4 19,618 20,758 40,376
OML 40 ** 45% NPDC
Starcrest27.0 - 27.0 5,211 - 5,211
OML 53 40% NAPIMS 44.1 127.9 172.0 3,275 - 3,275
OML 55Revenue
interestAMT 4.6 - 4.6 - - -
OPL 283 40% Pillar Oil 5.2 11.4 16.6 1,159 - 1,159
Ubima *** 88%All Grace
Energy3.7 - 3.7 765 - 765
TOTAL 240.5 258.9 499.4 30,029 20,758 50,787
* Reserve volumes stated at 1/1/21 are based on independent estimates from Ryder Scott
** Reverts to 20.25% after Westport shareholder loan is fully repaid
*** Reverts to 40% after Carry has been reached
GROUP PRODUCTION 2012 - 6M 2021 FY 2020 reserves and 6M 2021 production by asset
14,794
23,47424,252
29,003
10,091
17,853
25,669
23,935
33,714
28,54130,029
5,226
4,867
6,571
14,369
15,786
19,070
24,198
22,563
17,469
19,698
20,758
20,020
28,341
30,823
43,372
25,877
36,924
49,867
46,498
51,183
48,239
50,787
0
10,000
20,000
30,000
40,000
50,000
60,000
FY2012
FY2013
FY2014
FY2015
FY2016
FY2017
FY2018
FY2019
FY2020
3M2021
6M2021
Liquids Gas
6M 2021 financial resultsStrong recovery in revenues and profitability
Seplat Energy's Nigerian opportunity 70
$ million 6M 2021 6M 2020 Change
Oil revenue 244.8 180.1 35.9%
Gas revenue 64.0 53.5 19.7%
Total revenue 308.8 223.6 32.2%
Cost of sales (219.9) (195.9) 12.2%
Gross profit 88.9 37.7 136%
G&A (36.5) (47.6) (23.5%)
Underlift/overlift 59.9 49.4
Other 5.9 (152.3)
Operating profit / (loss) 109.5 (112.9) 197%
Net finance costs (47.5) (37.8)
(Loss)/Profit before tax 62.1 (145.3)
Tax credit / (expense) (25.9) 35.1
(Loss)/Profit for the period 36.2 (110.2) 143%
Capital investment 57.4 85.8
Cash flow from operations 109.9 165.8
NPDC receivables (vs. 31/12/20) 47.8 107.1
– Oil revenues up on higher price of
$64.69 vs $35.94, despite 13% lower
production
– Gas revenues up on 21% higher
production at $2.86/MMscf
– Production opex of $9.7/boe
– Operating profit of $110.0 million
– 6M 2020 included $152.3m impairment
charge under IAS36
– Tax charge contains deferred liability of
$11.3m and current charge of $14.6m
– Capex includes two completed gas
wells at Oben, engineering and gas
projects
– JV receivables significantly down
– Net debt of $456m
Capex priorities for 2021
2021 CAPEX PROJECTED TO BE $180M, ALLOCATED AS BELOW
OML 4,38,41— Two gas wells, Oben 50 and 51 completed and onstream H1— Drill two additional gas wells Q4 2021
OML 40— Drill three Gbetiokun oil wells— Sibiri exploration well
OML 53— Drill one appraisal well (Owu) in Q4 — Operationalise crude purchase agreement with Waltersmith— Collaborate with SPDC to deliver four ANOH gas wells
OPL 283— Umuseti-7 well (1,500bopd)— Implement Umuseti early production facility improvements— Complete Anagba Unitisation and Unit Operating Agreement
and joint Field Development Plan
GAS DEVELOPMENT— Spend $27m on Sapele Gas Plant, first gas now expected Q1 23 — Ohaji flares out project commencement
Focus investment on gas and development of lowest-cost oil wells
Seplat Energy's Nigerian opportunity 71
76
36
6
65
EXPECTED CAPEX ALLOCATION BY ASSET ($M)
OML 4, 38, 41
OML 53
OML 56
Eland
82
88
10 2
EXPECTED CAPEX BY BUSINESS ($M)
Gas
Oil
Exploration
Other
82
46
55
EXPECTED CAPEX BY ACTIVITY ($M)
Drilling
New projects
Maintainingexistinginfrastructure