The Chairman of Seplat Petroleum Development Company Plc, one of the leading Nigerian independent oil and gas companies, Dr. A.B.C. Orjiako, has said the company remains a resilient business that generates significant cashflow from low cost production base.
Orjiako, who stated this while addressing shareholders and other stakeholders during the company’s 7th annual general meeting(AGM) in Lagos, noted that the company was focused on delivering shareholder returns through regular dividend distributions and capital growth.
According to Orjiako, amidst the current headwinds occasioned by the prevailing coronavirus pandemic and low oil prices, Seplat would continue to maintain strict financial discipline over investment decisions, while also embedding high standards of corporate governance and transparency; strong commitment sustainable business; and effective management of risks with a strong HSE culture.
“I believe that Seplat has an important role to play throughout the energy transition that is set to occur in the years and decades ahead, not least through the impact we can have by scaling up our domestic gas supply business and displacing imported diesel fuels that are being burned for power generation and helping Nigeria benefit from the social and economic multiplier effects that reliable and affordable power availability can bring,” he said.
Against this backdrop, Orjiako said Seplat plans to position itself for an ambitious next phase of growth which would see the expansion of its footprint in terms of energy business activities, a plan to pursue offshore assets acquisition, as well as opportunity driven entry into different geographies.
He added: “Looking forward, one of the main challenges facing the independent exploration and production (E&P) sector is to remain relevant as the world makes the transition to a lower carbon future.
“The oil and gas industry face considerable challenges given that oil in particular plays such a significant part in today’s energy supply mix, with demand for the commodity still growing. A key part of my role as Chairman of the Board is to steer the Company through these transitions. “The board believes that such a corporate transition would require a different kind of organisational structure, people skills set and mentality to compete well in the expanded space. In view of this, over the course of 2020 we will be reviewing the current organisational and systems structure.”
The Seplat Chairman assured that the fundamentals of the company’s core business remain strong and through the effective integration of the Eland acquisition, the combined business will have greater scale and value creation opportunities to capture.
“I believe the investment case for Seplat remains compelling,” adding that: “As we look ahead to 2020 and beyond, I would like to take this opportunity to thank all Seplat employees and wider stakeholders for their efforts and continuing support and I look forward to updating all of our stakeholders on our progress throughout the year ahead.”