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 unaudited results for the nine months period ended 30 September, 2014, with the following highlights:
Financial Highlights:
- Turnover decreased by 12%, N338.1 billion compared to N386.3 billion (2013)
- Gross Profit increased by 70%, N79.6 billion compared to N46.7 billion (2013)
- Profit-Before-Tax increased by 4%, N10.2 billion compared to N9.8 billion (2013)
- Profit-After-Tax increased by 76%, N10.7 billion compared to N6.1 billion (2013)
Operational Highlights:
- Oando Energy Resources (OER): Achieved total production of 4.1 million boe in the nine months ended September 30, 2014 compared to 1.1 million boe in the comparative period of 2013
- Oando Energy Services: “OES Integrity” achieved 97.5% operating efficiency
- Oando Gas & Power: Progressed on the construction of the Greater Lagos (Phase 4) extension gas pipeline network
- Oando downstream successfully completed the construction of the Apapa Single Point Mooring jetty, with product through put testing ongoing
Commenting, Mr. Wale Tinubu, Group Chief Executive, Oando PLC said: “We are pleased to announce our performance over the past nine months of the year 2014. The group is making solid progress in achieving a more robust financial performance despite the current industry trend and 30% decline in global crude prices year to date. Our conservative nature ensures that we apply risk mitigating processes, by implementing hedging tools in the upstream on our future crude production, ~$100/barrel for 3 years. We also fixed our gas prices through long term contracts with our customers in the midstream sector and have taken advantage of the lower prices in landing our refined imported products, resulting in improved pricing efficiencies. As we wrap up 2014, we look forward to a full quarter’s production contribution from our newly acquired NAOC JV assets, which have steadily increased our current output above 50kboepd, as well as achieving diversity in earnings via our increased upstream contribution.”
Operational Update
In the Upstream exploration and production business, we have seen notable progress as production grew by 272% to a total of 4.1 million boe in the nine months ended September 2014. The increase was primarily due to the newly acquired working interest in OML 60 – 63 which contributed 2.9 million boe from July 30th to September 30th, 2014. Total production from OML 125 during the first nine months of 2014 increased by 11% in comparison to the prior year. This increase in was largely driven by increased production efficiency from producing wells and recommencement of production in the Abo 10 well in August rather than the planned September date. On OML 56 we have successfully completed the fiber optic cable laying and pipeline construction milestones associated with the Umugini pipeline project; the projected delivery date remains the fourth quarter of 2014.
Oando Energy Services achieved five years of continuous operations without a Lost Time Incident (LTI) on one of its four rigs, “OES Integrity” and continues to operate at an optimal efficiency of 97.5%. Further indicating our commitment to world class operating standards, with the proactive use of our EHSSQ and operational processes.
In the midstream, our Gas & Power business has achieved actual volume sales (YTD Sept 2014) of 15.76mmscf which is in line with our year end objectives. Having completed several factory acceptance tests, (pipeline stacking and pipeline construction for segment-1) our Greater Lagos Expansion project (Phase 4) is in its advanced stages of construction. The project is set to extend the company’s natural gas distribution network by 9km from Ijora to Bonny camp in Lagos state. The competed pipeline will allow us maximize capacity in Lagos from 60mmscf/day to 101mmscf/day, thus boosting our revenue and profits.
In our maiden downstream business, construction of the Apapa SPM jetty has been completed and is expected to be commissioned in Q4 2014, service upgrades have been completed on the Jetty and final product through put testing is ongoing. We have also commenced construction works on the upgrade of Marshaling yards and Sapara road, which is a proactive de-bottling response to the anticipated trucking activities expected from the terminal expansion and the commissioning of the ASPM Jetty.
As we wrap up 2014, we reaffirm our commitment to driving our business to greater heights and re-commit ourselves to deliver on our promised objectives. We look forward to ending the year with groundbreaking outcomes and superior shareholder value.
Ends.
