Seplat Energy Plc · LSE:SEPL
Seplat Energy — Seplat Petroleum Development Company — Investor Presentation (June 2021)
30 slides from Seplat Energy's investor presentation, June 2021
Slide 1: Powering Nigeria's Energy Transition
POWERING NIGERIA’S ENERGY TRANSITION INVESTOR PRESENTATION JUNE 2021 www.seplatpetroleum.com 1 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | INVESTOR PRESENTATION
Slide 2: Introducing Seplat
SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | 2 INVESTOR PRESENTATION INTRODUCING SEPLAT www.seplatpetroleum.com
Slide 3: Seplat's First Decade
SEPLAT’S FIRST DECADE A ten-year journey to become Nigeria’s leading independent energy supplier JULY 2010 MAY 2012 JUNE APRIL 2014 MARCH 2017 MARCH 2018 DECEMBER 2019 Acquired OMLs Drilled first of 2013 IPO & dual 225 MMscfd Oben Successfully Completed acquisition of the 4, 38, 41. >70 development
Slide 4: Key Investment Highlights
KEY INVESTMENT HIGHLIGHTS Financial discipline underpinned by high quality assets, gas business and prudent management team DIVERSIFIED, STRONG, LOCAL CHAMPION MATERIAL ESTABLISHED AND WITH SOLID PORTFOLIO OF GROWING GAS OPERATING TRACK PRODUCING OIL AND BUSINESS RECORD GAS ASSETS Eight blocks in pr
Slide 5: A Rich Portfolio of Producing Oil & Gas Assets
A RICH PORTFOLIO OF PRODUCING OIL & GAS ASSETS Eight onshore blocks in the prolific Niger Delta, ideally located for oil exports and internal gas demand centres OIL BUSINESS GAS BUSINESS Lagos Industry New Export Pipeline Papalanto (CNL) Existing Power/Industries OML4 Abuja 4Q3 Wagp OML40 Egbin/AES
Slide 6: A Rich Portfolio of Productive Oil & Gas Assets
A RICH PORTFOLIO OF PRODUCTIVE OIL & GAS ASSETS Eight blocks in the prolific Niger Delta, ideally located for export or internal demand centres W.I. 2P reserves * W.I. production MMboe FY 2020 boepd Block Share Partner Oil Gas Total Oil Gas Total OML 38 OML 40 OML 4, 38, 41 45% NPDC 156.0 119.5 275.
Slide 7: Proven Resilience Through Prudent Management
PROVEN RESILIENCE THROUGH PRUDENT MANAGEMENT Financial discipline and a robust business model have protected Seplat through difficult times INCREASING GAS VOLUMES FOR GROWING MARKET NEEDS FOCUSED CASH MANAGEMENT STRATEGY 49,867 $900 $451m Eland 51,183 50,000 46,498 Gross debt ($m) acquisition $900 $
Slide 8: Clearly Focused Capital Allocation Strategy
CLEARLY FOCUSED CAPITAL ALLOCATION STRATEGY We are focused on low-risk strategies to generate and deploy cash to grow the business and improve stakeholder returns GAS OIL RENEWABLES LOW-RISK CAPITAL • Invest in gas as transition fuel • Offset decline by developing • Enter market as appropriate • Dev
Slide 9: Governance and Sustainability
SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | 9 INVESTOR PRESENTATION GOVERNANCE AND SUSTAINABILITY www.seplatpetroleum.com
Slide 10: Highly Experienced Management Team and Board
HIGHLY EXPERIENCED MANAGEMENT TEAM AND BOARD The Board consists of highly experienced professionals with extensive experience in Nigeria’s O&G industry NON EXECUTIVE EXECUTIVE MANAGEMENT NON-EXECUTIVE DIRECTORS CHAIRMAN Dr. A.B.C. Roger Emeka Engr. Effiong Austin Nathalie Olivier de Orjiako Brown On
Slide 11: Commitment to Sustainable Development in Nigeria
COMMITMENT TO SUSTAINABLE DEVELOPMENT IN NIGERIA Seplat aligned with major United Nations Sustainable Development Goals, with ongoing efforts to address all in the future › Raising entrepreneurs among › Provision of potable water boreholes › We partner with communities to stakeholder communities to
Slide 12: A High Standard of Sustainability Governance
A HIGH STANDARD OF SUSTAINABILITY GOVERNANCE An effective governance structure coupled with dedicated resources for strategic priorities to support our sustainability journey SUSTAINABILITY EMBEDDED THROUGHOUT SEPLAT CORE STANDARDS GUIDED BY › Operate with the highest standard of corporate governanc
Slide 13: A Unique Local Champion
A UNIQUE LOCAL CHAMPION Leading indigenous E&P with strong local community relationships SUSTAINABLE COMMUNITY DEVELOPMENT CHAMPION LEADING INDIGENOUS PLAYER “The Seplat Way” › Comprehensive GMOU with local communities in OMLs 4, 38, and 41 and OML 53. Seplat’s local investment promotes the security
Slide 14: Our Markets
SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | 14 INVESTOR PRESENTATION OUR MARKETS www.seplatpetroleum.com
Slide 15: Nigeria's Energy Market in Context of Development
NIGERIA’S ENERGY MARKET IN CONTEXT OF DEVELOPMENT The oil and gas industries remain essential to Nigeria’s efforts to implement the UN’s Sustainable Development Goals LACK OF ECONOMIC DIVERSITY FORCES OIL DEPENDENCE GAS PROVIDES A TRANSITION PATH FOR ENERGY › Nigeria’s lack of economic diversity and
Slide 16: Exposure to Growing Energy Demand
EXPOSURE TO GROWING ENERGY DEMAND Seplat will be the leader in Nigeria’s inevitable energy expansion FACTORS INCREASING NIGERIA’S DEMAND FOR ENERGY › The population will more than double by 2050 - (200m to 450m by 2050) › Access to energy will increase - 60% today, with target of 100% by 2030 › Per-
Slide 17: Strong, Established and Growing Gas Business
STRONG, ESTABLISHED AND GROWING GAS BUSINESS… Leading producer and gas supplier to the domestic Nigerian market, providing c.30% of Nigeria’s domestic gas supply for electricity1 INCREASING GAS CONTRIBUTION GAS STRATEGY UNDERPINNED BY FAVOURABLE MACRO DRIVERS 210 Gas revenue ($m) WI gas production (
Slide 18: Key to Nigeria's Sustainable Energy Transition
…KEY TO NIGERIA’S SUSTAINABLE ENERGY TRANSITION Seplat plays an important role in Nigeria’s sustainable development and corresponding increase in energy needs OFF-GRID GENERATION DOMINATES AND DAMAGES1 NIGERIA GAS DEMAND TO GROW 20 BCM BY 2035 (Megawatts) › Population forecast to more than double by
Slide 19: Investing for a Sustainable Energy Transition
INVESTING FOR A SUSTAINABLE ENERGY TRANSITION Alongside our continued investment in gas, Seplat’s creation of the New Energy unit is key to Nigeria’s transition strategy UPDATE ON INVESTMENT IN ENERGY TRANSITION SCOPING THE RENEWABLES OPPORTUNITY IN NIGERIA › In late 2020, Seplat announced the creat
Slide 20: Performance Update
SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | 20 INVESTOR PRESENTATION PERFORMANCE UPDATE www.seplatpetroleum.com
Slide 21: Value-Creation Strategy
VALUE-CREATION STRATEGY A multi-faceted approach to developing the business • Convert existing 2C resources INCREASE • Increase exploration and development RESERVES • Acquire assets, e.g. Eland INCREASE • Improve efficiency PRODUCTION • Increase drilling • Develop gas production facilities AND PROFI
Slide 22: FY 2020 Performance
FY 2020 PERFORMANCE Seplat delivered production well within guidance and maintained a healthy cash balance despite low oil prices A STRONG PERFORMANCE DESPITE CHALLENGING MARKET KEY FIGURES › 51,183 boepd total › $39.95/bbl realised VOLUMES WITHIN GUIDANCE Production › Liquids 33,714 bopd Oil price
Slide 23: 3M 2021 Performance
3M 2021 PERFORMANCE Production within guidance, successful financing of ANOH project and $650m bond issue A STRONG PERFORMANCE DESPITE CHALLENGING MARKET KEY FIGURES › 48,239 boepd total › $60.76/bbl realised in VOLUMES WITHIN GUIDANCE Production › Liquids 28,541 bopd Oil price 3M 2021 within › Gas
Slide 24: 3M 2021 Working-Interest Production
3M 2021 WORKING-INTEREST PRODUCTION Volumes within guidance despite delays siting new storage vessel at OML 40 boepd 60,000 Oil production OIL BUSINESS PERFORMANCE Gas production 49,867 51,183 › Average W.I. production in 3M 2021 50,000 46,498 48,239 28,541 boepd 43,372 › OML40 production lower owin
Slide 25: Performance Review
PERFORMANCE REVIEW Continuing focus on reducing overall costs, especially OML40 barging, and improving safety culture OIL BUSINESS GAS BUSINESS › OML40 production affected by delay to siting replacement storage vessel › 114 MMscfd (W.I.) achieved across the quarter › OML 4, 38, 41 experienced 16% do
Slide 26: 3M 2021 Financial Results
3M 2021 FINANCIAL RESULTS Return to profitability and cash position remains strong › Oil revenues up on higher realised prices ($60.8/bbl vs $49.9/bbl), $ million 3M 2021 3M 2020 Change despite lower volumes due to delays in siting storage vessel at OML 40 Oil revenue 124.1 107.4 15.6% › Gas revenue
Slide 27: Capex Priorities for 2021
CAPEX PRIORITIES FOR 2021 Focus investment on gas and development of lowest-cost oil wells › 2021 capex projected to be $150m, budgeted as below CAPEX ALLOCATION BY ASSET ($m) › OML 4,38,41 - Increase gas IPSC by 15% - Drill three gas wells at Oben 36 OML 4, 38, 41 › OML 40 OML 53 72 - Drill three G
Slide 28: Timetable of Strategic Events
TIMETABLE OF STRATEGIC EVENTS Seplat is progressively strengthening and diversifying business EVENT EXPECTED IMPACT EXPECTED › Successful completion of funding substantially ANOH PROJECT FINANCING de-risks ANOH project › Issue of $650m 7.75% Senior Notes to redeem existing $350m 9.25% senior notes,
Slide 29: Outlook and Drivers of Future Value
OUTLOOK AND DRIVERS OF FUTURE VALUE Short term focus on efficiency, cash generation, longer term significant growth prospects GUIDANCE FOR 2021 SHORT TERM VALUE DRIVERS (0-2 YEARS) VOLUME GUIDANCE 1. New gas wells expected to increase gas production in 2021 (75MMscfd gross) 2. Increase in production
Slide 30: Head Office, London Office, Investor Relations
Head Office Seplat Plc 16A, Temple Road, Ikoyi, Lagos, Nigeria. +234 (0)1 277 0400 info@seplatpetroleum.com www.seplatpetroleum.com London Office Seplat UK Ltd. 4th Floor, 50 Pall Mall, London SW1Y 5JH +44 (0)20 3725 6500 Investor Relations CFranklin@seplatpetroleum.com AAliyu@seplatpetroleum.com 30
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