The company’s Chairman, Dr Ambrose Orjiako, disclosed this while addressing shareholders and other stakeholders during the company’s 7th Annual General Meeting held in Lagos, Nigeria.
According to Orjiako, amid the current headwinds occasioned by the prevailing global coronavirus pandemic and low oil prices, Seplat will continue to maintain strict financial discipline over investment decisions.
He said the company would continue to embed high standards of corporate governance and transparency; strong commitment sustainable business; and effective management of risks with a strong health, safety and environment culture.
He said, “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.”
This is helping Nigeria benefit from the social and economic multiplier effects that reliable and affordable power availability can bring, according to Orjiako.
He said Seplat planned to position itself for an ambitious next phase of growth which would see the expansion of its footprint in terms of energy business activities and the acquisition of offshore assets.
He said, “Looking forward, one of the main challenges facing the independent exploration and production sector is to remain relevant as the world makes the transition to a lower-carbon future.
“The oil and gas industry faces 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.”
Orjiako added, “I believe the investment case for Seplat remains compelling. 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.”
The Chief Executive Officer, Seplat, Mr Austin Avuru, described 2019 as a solid year in which the robust fundamentals of the business once again kept the company on an extremely solid footing.
“The strong cash generation we realised from our low-cost production base meant that our capital expenditures, debt service obligation and dividend distributions to shareholders were more than covered by cash generated from operations by a comfortable margin,” he added.
He noted that the company took a final investment decision on the ANOH midstream gas processing project last year.
He said, “Once completed, the plant will process gas produced at the upstream unitised gas fields in OML 53, where Seplat has a 40 per cent working interest, and Shell’s OML 21.
“Now that we have gone live, so to speak, with the project in partnership with the government, we have set a clear trajectory that will see us become the largest supplier of processed gas to the domestic market once it becomes operational.”