Seplat Energy Plc · LSE:SEPL
Seplat Energy — Merger or Acquisition (December 2024)
40 slides from Seplat Energy's merger presentation, Dec 12, 2024
Slide 1: Completion of the Mobil Producing Nigeria Unlimited Acquisition
COMPLETION OF THE MOBIL PRODUCING NIGERIA UNLIMITED ACQUISITION 12 December 2024 reliable energy, limitless potential
Slide 2: Welcome: Today's Presenters & Agenda
WELCOME Today’s Presenters & Agenda Presenters Agenda Roger Brown Chief Executive Officer 1. Transaction Overview --- Eleanor Adaralegbe 2. MPNU – World Class Assets Chief Financial Officer --- 3. Financial Highlights Samson Ezugworie Chief Operating Officer 4. Summary & Strategic Priorities 2 SEPLA
Slide 3: Transaction Overview
TRANSACTION OVERVIEW STEP CHANGE IN SCALE reliable energy, limitless potential 3 SEPLAT ENERGY PLC COMPLETION OF MPNU ACQUISITION - 12 DECEMBER 2024
Slide 4: Nigeria's Leading Independent E&P
NIGERIA’S LEADING INDEPENDENT E&P A TRANSFORMATIONAL ACQUISITION: A NEW VALUE PROPOSITION Acquisition of the entire issued share capital of Mobil 3,500 3,164 Revenue ($m) Producing Nigeria Unlimited (‘MPNU’) 3,000 2,500 40% WI and operator of four of Nigeria’s most prolific, shallow water, oil 2
Slide 5: Step Change in Scale: Diversified Asset Base
STEP CHANGE IN SCALE: DIVERSIFIED ASSET BASE Broad, diversified asset base. Important operator of upstream, midstream and export facilities in Nigeria Key Facts Asset Location Map 11 (7) blocks in Nigeria 8 operated blocks 1,210 MMboe 2P + 2C reserves and resources 48 (17) producing oil & ga
Slide 6: Step Change in Scale: Key Metrics
STEP CHANGE IN SCALE: KEY METRICS Delivers a step change in scale, for reserves, production, cash generation FY23 WI Production +160% 2P Reserves +86% Production split: Oil & NGL 80%, Gas 20% 2P Oil +145%, 2P Gas +25% PF 2P + 2C: 1,210 MMboe, +124% 124,054 887 478 x1.9 47,758 x2.6 Seplat Pro-F
Slide 7: New Value Proposition
NEW VALUE PROPOSITION Post acquisition, Seplat is one of the largest listed E&Ps across key metrics of production and reserves Enhanced Scale Enhanced Shareholder Value Seplat established as one of the largest UK E&Ps among listed peers Per share metrics transformed given no equity dilution Sign
Slide 8: MPNU Strategic Benefits
MPNU STRATEGIC BENEFITS Scale, Leadership, Growth drive enhanced stakeholder prosperity SCALE: Adds proven, high-quality, operated, shallow water assets, generating material US$ cash flow LEADERSHIP: Cements Seplat’s position as leading indigenous energy company in Nigeria GROWTH: Large upside poten
Slide 9: Giant Oil & Gas Accumulations
GIANT OIL & GAS ACCUMULATIONS Proven, giant oil and gas business 6.9 Billion barrels produced: 1970 to 2023… …Multi-Billion-barrel potential remains World class petroleum system across the license area CPR certified JV 2P 1,003 MMboe + 2C 653 Mmboe (1) 12 of the 31 developed fields have to dat
Slide 10: Natural Gas: Multi-TCF Potential
NATURAL GAS: MULTI-TCF POTENTIAL Targeting commercialisation of multi-TCF gas resources to support Nigeria’s long-term energy transition ambitions Natural Gas historically focused on …Giant, largely undeveloped gas resource a key upside production support… CPR certified 3.2 Tcf 2C (5.5 Tcf 3C) gro
Slide 11: MPNU: World Class Assets
MPNU WORLD CLASS ASSETS reliable energy, limitless potential 11 SEPLAT ENERGY PLC COMPLETION OF MPNU ACQUISITION - 12 DECEMBER 2024
Slide 12: MPNU License & Asset Summary
MPNU LICENSE & ASSET SUMMARY MPNU adds significant scale and diversification in Nigeria Portfolio Summary 40% operated interest in four offshore OMLs (67, 68, 70 and 104), 9.6% non-operated interest in Amenam-Kpono field - >120 shallow water and offshore facilities, >200 producing wells, ~1,500 km
Slide 13: Dedicated Export Routes
DEDICATED EXPORT ROUTES Large resource base and operational control of export routes Extensive production infrastructure 2) 2 Bonny River Terminal NGL Recovery Plant (BRT) 31 oil and gas fields producing via 11 production platforms BRT NGL Recovery Plant located next to the Bonny Terminal Frac
Slide 14: Upstream: World Class Assets
UPSTREAM: WORLD CLASS ASSETS Resilient production together with high quality assets provides platform for growth World class resource Large, proven oil and gas accumulations across the license area High quality Tertiary Age (5-10 Million yr old) Niger Delta sandstones – attractive geology suppor
Slide 15: Multiple Growth Opportunities
MULTIPLE GROWTH OPPORTUNITIES Wide range of identified projects, which can boost production and commercialise gas Indicative future development activities Intervention (IN): Indicated here in OML 67, but opportunities across the four licenses. - This activity is a key target for near term producti
Slide 16: Financial Strength
FINANCIAL STRENGTH IMMEDIATELY ACCRETIVE TRANSACTION reliable energy, limitless potential 16 SEPLAT ENERGY PLC COMPLETION OF MPNU ACQUISITION - 12 DECEMBER 2024
Slide 17: Transaction Costs
TRANSACTION COSTS Assets acquired for a compelling multiple of $2.0/boe on a 2P basis Transaction Cost Evolution ($m) Completion cost benefits from Locked Box adjustment 1800 Transaction effective date is 1st January 2021 and completion date is 12 December 2024 1600 Cash paid at closing $672 mil
Slide 18: Transaction Financing
TRANSACTION FINANCING Balance sheet strength-maintained post deal close Completion funding Closing fully funded from cash & debt Diversified debt capital structure $ million $ million, at 6M24* New 3-year $300 million Advanced Payment Facility with ExxonMobil Trading, deepens relationship, on 900
Slide 19: Transformational on Key Financial Metrics
TRANSFORMATIONAL ON KEY FINANCIAL METRICS Key pro-forma financial metrics illustrate substantial increases in revenues, cashflows, & profitability Revenue (US$ m) Adj. EBITDA (US$ m) Net Income (US$ m) x1.3 3,164 1,784 161 x3 117 124 x4 105 1,456 800 952 1,061 50 55 733 417 448 372 422 267 2021 2022
Slide 20: Attractive Pricing; Discounted Value
ATTRACTIVE PRICING; DISCOUNTED VALUE Acquisition at attractive metrics relative to similar-sized transactions; foundation for enhanced shareholder returns EV/2P ($/boe); ~$2/boe acquisition cost doesn’t account for gas upside Price per flowing barrel ($/boe/day); MPNU biased to high value liquids pr
Slide 21: Operating Metrics: A Story of Resilience
OPERATING METRICS: A STORY OF RESILIENCE Efficiently deploying capex will support growth ambitions Production Analysis, high % liquids Annual production, low decline rate High quality oil typically sells at a premium to dated Brent WI, FY 23, kboepd (incl A/K) WI, boepd (incl. A/K) - Regular crude
Slide 22: Summary: Strategic Priorities
SUMMARY STRATEGIC PRIORITIES reliable energy, limitless potential 22 SEPLAT ENERGY PLC COMPLETION OF MPNU ACQUISITION - 12 DECEMBER 2024
Slide 23: Seplat Energy's Track Record of Success
SEPLAT ENERGY’S TRACK RECORD OF SUCCESS Successful capital allocation strategies have delivered $645 million in dividends to shareholders since IPO Invested to grow and maintain reserves (2P, MMboe) Generated strong FCF through the commodity cycle ($m) 600 414 416 509 499 336 480 462 477 481 478 500
Slide 24: A Proven Operator in Nigeria
A PROVEN OPERATOR IN NIGERIA Track record of operating mature assets in Nigeria. Strategies can be replicated on MPNU Experience in rejuvenating Consistently active operator Deep collaboration with the mature assets Drilling activity on 124 wells since 2012 Nigerian supply chain (includes: explora
Slide 25: MPNU Priorities for 2024/25
MPNU PRIORITIES FOR 2024/25 Early activities focus on integration, short cycle opex/capex, medium term planning People & Safety Initiate our fully scoped transition plan c.1,000 Staff and c.300 contractors joining Seplat No Job losses MPNU MD to join Seplat Exco Asset integrity activities
Slide 26: Step Change in Value Creation Potential
STEP CHANGE IN VALUE CREATION POTENTIAL Deploy our leadership as a responsible operator in Nigeria to maximise the value of MPNU for all stakeholders STRATEGIC AND ORGANISATIONAL BENEFITS Value enhancing transaction: significant uplift on a range of operational, financial and per share metrics fro
Slide 27: Important Notice
IMPORTANT NOTICE Disclaimer The following applies to the information preceding this slide, and you are therefore advised to carefully read the statements below before reading, accessing or making any other use of this presentation. Disclaimer The information contained in this document has been prepa
Slide 28: Appendix: Asset Overviews and Additional Information
APPENDIX ASSET OVERVIEWS AND ADDITIONAL INFORMATION reliable energy, limitless potential 28 SEPLAT ENERGY PLC COMPLETION OF MPNU ACQUISITION - 12 DECEMBER 2024
Slide 29: Asset & License Summary
ASSET & LICENSE SUMMARY Large resource base and operational control of export routes Production Working 2P Reserves 2C Reserves 2P + 2C Reserves Current License Asset/License Role Platforms Interest (%) (MMboe)* (MMboe)* (MMboe)* Expiry Inim, Ubit, Etim, Edop OML 67 Operator 40% 185.4 146.0 331.4 10
Slide 30: Spotlight on: OML 67
SPOTLIGHT ON: OML 67 OML 67 includes key fields Ubit & Edop DESCRIPTION OF THE ASSET ASSET MAP OML 67, one of the largest blocks in the Niger Delta, came onstream in 1970 and currently utilises 5 production platforms Crude is gathered at the Idoho production platform and is then sent to the onsh
Slide 31: Spotlight on: OML 68
SPOTLIGHT ON: OML 68 OML 68 includes key field Idoho DESCRIPTION OF THE ASSET ASSET MAP OML 68 came onstream in 1970 and utilises the single Idoho production platform OML 68 crude joins OML 67 crude at the Idoho production platform and is then sent to the onshore Qua Iboe Terminal for processing
Slide 32: Spotlight on: OML 70
SPOTLIGHT ON: OML 70 OML 70 includes key fields Oso & Usari DESCRIPTION OF THE ASSET ASSET MAP OML 70 came onstream in 1970 and utilises 4 production platforms; also includes a 9.6% non-operated interest in the A/K field which is unitised across OML 70 and OML 99 Crude is gathered at the Oso pro
Slide 33: Spotlight on: OML 104
SPOTLIGHT ON: OML 104 OML 104 includes key fields Yoho & Awawa DESCRIPTION OF THE ASSET ASSET MAP OML 104 came onstream in 2002 and utilises the single Yoho production platform Crude is exported locally using a floating storage offloading (FSO) vessel Future opportunities include identified in
Slide 34: NGL Extraction Overview
NGL EXTRACTION OVERVIEW Maximising value via NGL extraction performed offshore and onshore DESCRIPTION OF THE ASSET ASSET MAP NGL extraction from wet gas began in 1998 from the Oso NGL Project (OML 70), with the East Area Project (OML 67) coming online in 2002 NGLs sent to the onshore Bonny Rive
Slide 35: MPNU Historical Income Statement
MPNU HISTORICAL INCOME STATEMENT Income Statement ($’000) FY 2021 FY 2022 FY 2023 6M 2023 6M 2024 Revenue from contracts with customers 1,840,531 3,081,576 2,102,464 1,092,434 1,034,425 Cost of sales (1,117,983) (1,495,639) (1,174,759) (531,425) (651,984) Gross profit 722,548 1,585,937 927,705 561,0
Slide 36: MPNU Historical Balance Sheet
MPNU HISTORICAL BALANCE SHEET Balance Sheet ($’000) FY 2021 FY 2022 FY 2023 6M 2024 Oil and gas property, plant, & equipment 4,471,699 3,127,355 2,672,109 2,310,218 Other non-current assets 887,627 733,383 543,469 468,981 Total non-current assets 5,359,326 3,860,738 3,215,578 2,779,199 Inventories 3
Slide 37: MPNU Historical Cashflow Statement
MPNU HISTORICAL CASHFLOW STATEMENT Cashflow Statement ($’000) FY 2021 FY 2022 FY 2023 6M 2023 6M 2024 Cash generated from operations 725,780 1,441,767 1,092,099 454,223 423,092 Tax paid (582,809) (1,254,290) (962,816) (527,221) (384,026) Other cashflow from operations (65,009) (57,378) (8,956) - (3,
Slide 38: Pro-Forma Income Statement & Balance Sheet
PRO-FORMA INCOME STMNT & BALANCE SHEET Income Statement ($’000) FY 2023 Balance Sheet ($’000) 9M 2024* Oil and gas property, plant, & equipment 3,990,826 Revenue from contracts with customers 3,163,735 Other non-current assets 1,416,995 Cost of sales (1,704,034) Total non-current assets 5,407,821 Gr
Slide 39: Fiscal Terms and the PIA
FISCAL TERMS AND THE PIA The Petroleum Industry Act presents a significant potential upside, particularly in enhancing post-tax cash flow from operations COMMUNITY, KEY FISCAL INCENTIVES AND ENVIRONMENT AND ROYALTIES TAXES CHANGES ABANDONMENT DEDUCTIONS Production Allowances (PA) replaces Compan
Slide 40: Contact Us
CONTACT US Lagos London reliable energy, limitless potential
Seplat Energy — Merger or Acquisition (December 2024) on 6ix