Seplat plans second exploration well after Aku-01 discovery

Seplat Energy Plc is planning a second exploration well in 2027 after discovering oil and gas across five reservoir intervals in its Aku-01 exploration well in Petroleum Prospecting Licence 2A25.

The discovery, made after the reporting period, has de-risked four prospects on the licence, one of which the company plans to test through another exploration well.

Seplat disclosed this in its unaudited nine-month results for the period ended 30 September 2026, released on 30 September.

The company said the exploration success at Aku-01 demonstrated the potential of its portfolio of prospects and the quality of Nigeria’s subsurface resources.

While announcing the “discovery of oil and gas across five reservoir intervals in the Aku-01 exploration well, in PPL 2A25,” it added that the “discovery de-risks four prospects on the licence, one of which will be tested in a second exploration well that is now being planned for 2027.”

Commenting on the results, Seplat’s Chief Executive Officer, Effiong Okon, said the discovery highlighted the opportunities available in the company’s exploration portfolio.

“I’m pleased to announce exploration success at Aku-01, a strong reminder of our rich portfolio of prospects and the quality of the subsurface in Nigeria,” he stated.

The company also reported an increase in its production during the nine-month period, with working interest production averaging 144,999 barrels of oil equivalent per day, representing a seven per cent rise from 135,636 boepd recorded in the corresponding period of 2025.

Onshore production grew 22 per cent, while third-quarter production averaged 155,801 boepd, up 13 per cent from 137,888 boepd in the corresponding quarter of 2025.

Seplat attributed its operational performance partly to its offshore idle well restoration programme, which added 33,700 barrels of oil per day and 176 million standard cubic feet of gas per day in gross joint venture production capacity from 41 wells restored year-to-date. Four of the restored wells were gas wells.

The company also reported that the first commercial gas was sold through the OB3 pipeline in September following the initial debt principal repayments on the Assa North-Ohaji South gas project during the third quarter.

Its financial performance also improved, with revenue rising 27 per cent to $2.764bn from $2.177bn in the corresponding period of 2025.

Adjusted earnings before interest, taxes, depreciation and amortisation increased 38 per cent to $1.53bn from $1.112bn, while net income rose 174 per cent to $260.2m.

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Seplat’s earnings per share increased 172 per cent to 42 US cents from 16 US cents in the previous year.

Cash generated from operations stood at $1.479bn, compared with $1.395bn in the corresponding period of 2025.

The company also recorded a reduction in its net debt to $234.9m at the end of September, representing a 65 per cent decline from $673.3m at the end of 2025.

Its net debt-to-EBITDA ratio improved to 0.14 times from 0.53 times at the end of 2025, while cash at bank increased to $556.9m from $332.3m at the end of the previous financial year.

Seplat further disclosed that it repaid the remaining $100m balance on its Acquisition Payment Facility on 27 October, completing the repayment of all debt raised to acquire Mobil Producing Nigeria Unlimited in 2024.

On shareholder returns, the company declared a third-quarter dividend of 19 US cents per share, comprising a core dividend of five US cents and a special dividend of 14 US cents.

The dividend represented a 58 per cent increase from the previous quarter, while cumulative dividends declared for the year stood at 40 US cents per share.

Seplat retained its full-year 2026 dividend guidance of $270m, equivalent to 45 US cents per share.

The company also retained its production guidance at the upper end of its revised range of 145,000 to 155,000 boepd, compared with its previous guidance of 135,000 to 155,000 barrels per day.

It lowered its capital expenditure guidance to between $280m and $340m from $360m to $440m, primarily because of changes in project timing following the late arrival of the offshore rig.

However, its unit operating cost guidance increased to between $15.5 and $16.5 per barrel of oil equivalent from $14.5 to $15.5, reflecting ongoing costs associated with the Yoho project.

Seplat said the Yoho restoration project was completed during the third quarter, but its start-up was delayed by pipeline damage identified during the period. Production was expected to resume in the fourth quarter of 2026.

The company also reported a 14 per cent reduction in its group carbon emissions intensity to 37.4 kilogrammes of carbon dioxide per barrel of oil equivalent from 43.6 kilogrammes in the corresponding period of 2025.