Lagos, Nigeria – Oando PLC (referred to as “Oando” or the “Group”), Nigeria’s leading indigenous energy group listed on both the Nigerian and Johannesburg Stock Exchange, today announced audited results for the twelve months period ended 31 December, 2015, with the following highlights:
Financial Highlights:
- Turnover decreased by 10%, N381.7 billion compared to N425.7 billion (2014)
- Gross Profit increased by 7%, N77.7 billion compared to N72.3 billion (2014)
- Loss-Before-Tax decreased to (N51) billion compared to (N138) billion (2014)
- Loss-After-Tax decreased to (N49.7) billion compared to (N145.7) billion (2014)
Operational Highlights:
Upstream:
- Oando Energy Resources (OER): 118% increase in total production to 19.9 million boe in the 2015 as compared to 9.1 million boe 2014.
- Growth in average production from 24,945 boe/day in 2014 to 54,520 boe/day in 2015.
- Oando Energy Services celebrated 5 years of continuous operations without a Lost Time Incident (LTI) on “OES Teamwork” swamp drilling rig.
- OES celebrated 3 years of continuous operations without a Lost Time Incident (LTI) on “OES Passion” swamp drilling rig.
Midstream:
- Oando Gas and Power commences 8.5km pipeline expansion for the Central Horizon Gas Company (CHGC)
- Oando Gas and Power signs Sales and Purchase Agreement (SPA) to sell the Akute Independent Power Plant (IPP)
Downstream:
- Oando PLC amends and restates terms of recapitalization via the injection of USD210million from Helios/Vitol JV.
- Oando Downstream increases global footprint by incorporating a trading business in Dubai.
- Oando Downstream successfully completed construction of a 14.4 million litre PMS tank in the Apapa terminal.
Commenting, Mr. Wale Tinubu, Group Chief Executive, Oando PLC said: “2015 remained a turbulent year for the global oil and gas industry as business models had to be altered to enable industry players survive this new reality, by focusing on cost optimisation, increasing operational efficiency and downscaling capital expenditure. This re-evaluation of our business has resulted in the execution of strategic initiatives, which we are confident will return our business to profitability in the short-term in 2016, with Growth through our dollar earning upstream portfolio, Deleverage through recapitalization or asset divestments, and Profitability hinged on refocused dollar oil export trading business”.
Operational Update
Oando Energy Resources increased its total production to 20 million barrels of oil equivalent (mmboe) in 2015 period compared with 9.1 mmboe in 2014. The increase between the annual periods was primarily from the acquisition of OMLs 60 – 63 in H2 2014, as well as the commencement of production from the Qua-Iboe field in Q1 2015.
OER successfully realized a cash inflow of $234 million by resetting its crude oil hedge from the previously hedged average of $95.35 per barrel to a new price of $65.00 per barrel on 10,615bbls/day till July 2017 and an additional 1,553 bbls/day until January 2019. The proceeds of the hedge reset along with cash in hand were used to pay down substantial portion of our debt.
Oando Energy Services (OES) successfully deployed OES Respect into a 2 year, with 1 year extension contract with an IOC in October 2015. OES achieved five and three years of continuous operations with a Zero Lost Time Incident (LTI) on two of its four rigs, “OES Teamwork” and “OES Passion” respectively. We continue to consistently demonstrate our commitment to world class operating standards, with the proactive use of our EHSSQ and operational processes.
Oando Gas & Power (OGP) as at December 2015 had completed 87% of the Greater Lagos Phase 4 pipeline project which runs from Ijora to Bonny Camp in Lagos state, the project involves the deployment of Horizontal Directional Drilling (HDD) technology across three rivers on the Marina axis, is expected to be completed by the end of Q3 2016. OGP also commenced an 8.5km pipeline expansion project for the Central Horizon Gas Company, the expansion project which is expected to extend the pipeline from 8.3km to 16.8km and increase CHGC’s capacity to 70mmscf/day, is to be completed in 2016. In line with our strategy to Build, Operate and Transfer in the gas and power business, we signed the Sales and Purchase Agreement (SPA) for Akute divestment effective end of August 2015. The divestment process has been completed as at Q1 2016.
Oando downstream successfully concluded tie-ins to third party terminals via a 2km Horizontal Directional Drilled pipeline. The jetty will alleviate delays associated with product delivery into the Apapa, reduce long term cost of operations, as well as provide possible revenue streams from excess capacity. In 2015, the marketing arm completed upgrading of its LPG plants, the Apapa LPG plant capacity was upgraded from 15mt/day to 30mt/day, representing a 100% increment, while the Benin plant was upgraded to include best in industry safety standards.
Ends.
