Economy

Oando Declares N330b Turnover In 9 Months

Published

8 years ago

04/11/2016

Dipo Olowookere

oando-plc

By Modupe Gbdayanka

Nigeria’s leading indigenous energy group listed on both the Nigerian and Johannesburg Stock Exchange, Oando Plc, has announced its unaudited results for the six months period ended on September 30, 2016.

In the financial analysis, the company recorded a turnover increase by 26 percent, moving from N262 billion in the same period last year to N330 billion this year.

However, its Gross Profit decreased by 52 percent, N28.7 billion compared to N60 billion in the first half of 2015. Also, it Loss-After-Tax decreased by 25 percent, N35.9 billion compared to N47.6 billion in H1 2015.

Looking at its operational highlights, Oando Energy Resources (OER), during the nine months ended September 30, 2016, recorded a production of 12.0 MMboe (average 43,617 boe/day) in the upstream, while in the midstream, the company signed a definite agreement to divest 49 percent voting rights in Oando Gas & Power (OGP) to Helios Investment Partners for $115.8 million.

During the period under review, OGP Achieved 59 percent completion in Central Horizon Gas Company (CHGC) Pipeline Expansion Project, while it achieved 93 percent completion in Greater Lagos 4 Project.

Oando said in a press statement announcing its financial results that the “Nigerian economic environment continues to impact our business as we witnessed a further devaluation of the Naira during Q3, 2016, from an average exchange rate of N280.00:$1.00 in Q2 to an average of N316.00:$1.00 in Q3 2016.”

This, it explained, has resulted in further foreign exchange losses due to an impairment of our dollar denominated receivables.

“For the major part of the year, we have faced operational challenges due to the unrest in the Niger

Delta, however we find comfort in The Nigerian Government’s discussions and engagement in the region, indicating a possible resolution and as thus we expect our production levels to stabilise and gradually incline in the coming months. Despite these economic challenges, we must highlight our achievements in the 3rd quarter as witnessed by the improvement in our top line revenue as a result of our new business model of a diversified business with higher weighted dollar earnings in both the Upstream and International Trading businesses,” Oando said.

It said the above drove revenues up by 96 percent and led to significant foreign exchange gains between the second and third quarters.

Commenting on the results, Mr Wale Tinubu, Group Chief Executive, Oando PLC said: “The third quarter witnessed the FGN establish a seize fire with the militants responsible for production disruptions in the Niger Delta, leading to stabilised daily productions from our assets and expectations of imminent increases to our 2015 production highs of 56kbbls/day.

“We have also been proactive in our cost management initiative to ensure maximised value extraction for every barrel of oil produced as the global oil price still lingers below $50/bbl. We are pleased to have executed a SPA with Helios Investment partners for ~$116 million, representing 49 percent legal voting rights in the company’s midstream business, of which the proceeds of the divestment will be utilised towards the company’s debt restructuring initiative.

“The trading business has grown significantly this quarter having exported over 14 cargoes of crude with volumes exceeding 14mmbbls and an additional 8 cargoes of other oil based products. Our business model of dollar denominated earnings is taking shape as evidenced from the increased revenue line and future increases from the Upstream business through production and export trading businesses through increased lifting’s, whilst focusing on reduced costs to ensure profitability through these streams.”

Operational Update

Oando PLC successfully concluded the recapitalization and partial divestment of Oando Downstream for $210 million.

Oando Energy Resources (OER) had an average production of 41,094 boe/day compared to 53,169 boe/day in the third quarter of 2015, this reduction was mainly due to the disruptions in the Niger Delta. Notwithstanding, the corporation continues to shrink its debt burden as witnessed by a reduction in debt from $900 million post acquisition in 2014 to $407 million today, signifying a total pay down of over 50% in 2 years.

Our trading business, Oando Trading Dubai (OTD) posted revenues of N64.9bn in Q3 from lifting volumes exceeding 14mmbbls from 14 cargoes of crude and an additional 8 cargoes of other petroleum products.

In September 2016, Oando PLC signed a definitive agreement with Helios Investment Partners to divest 70% economic rights in Oando Gas and Power. The agreed transaction consideration of US$ 115.8 million is conditional upon the receipt of regulatory approvals and subject to customary purchase price adjustments. Upon completion, 49% of the voting rights in OGP would be retained by Oando, while Helios Investment Partners will hold 49% and the residual 2% will be held by a local entity.

Oando Gas & Power (OGP) as at H1 2016, achieved 59% completion of the Central Horizon Gas Company 8.5 km pipeline expansion project, the pipeline, which is set to be completed in the fourth quarter of 2016, and will increase the throughput capacity by 400%, thereby providing increased supply of gas in the South-East region of Nigeria.

During the 3rd Quarter 2016, Oando Gas and Power connected 7 new customers to the pipeline network of GNL. These customers are expected to increase GNL’s gas volume sales in 2016. The business also connected 3 new major customers in GNSL, with significant increase in monthly volume sales performance.

Economy

Aradel Holdings Acquires Equity Stake in Chappal Energies

Published

4 hours ago

11/12/2024

Aduragbemi Omiyale

By Aduragbemi Omiyale

A minority equity stake in Chappal Energies Mauritius Limited has been acquired by a Nigerian energy firm, Aradel Holdings Plc.

This deal came a few days after Chappal Energies purchased a 53.85 per cent equity stake in Equinor Nigeria Energy Company Limited (ENEC).

Chappal Energies went into the deal with Equinor to take part in the oil and gas lease OML 128, including the unitised 20.21 per cent stake in the Agbami oil field, operated by Chevron.

Since production started in 2008, the Agbami field has produced more than one billion barrels of oil, creating value for Nigerian society and various stakeholders.

As part of the deal, Chappal will assume the operatorship of OML 129, which includes several significant prospects and undeveloped discoveries (Nnwa, Bilah and Sehki).

The Nnwa discovery is part of the giant Nnwa-Doro field, a major gas resource with significant potential to deliver value for Nigeria.

In a separate transaction, on July 17, 2024, Chappal and Total Energies sealed an SPA for the acquisition by Chappal of 10 per cent of the SPDC JV.

The relevant parties to this transaction are working towards closing out this transaction and Ministerial Approval and NNPC consent to accede to the Joint Operating Agreement have been obtained.

“This acquisition is in line with diversifying our asset base, deepening our gas competencies and gaining access to offshore basins using low-risk approaches.

“We recognise the strategic role of gas in Nigeria’s energy future and are happy to expand our equity holding in this critical resource.

“We are committed to the cause of developing the significant value inherent in the assets, which will be extremely beneficial to the country.

“Aradel hopes to bring its proven execution competencies to bear in supporting Chappal’s development of these opportunities,” the chief executive of Aradel Holdings, Mr Adegbite Falade, stated.

Economy

Afriland Properties Lifts NASD OTC Securities Exchange by 0.04%

Published

8 hours ago

11/12/2024

Adedapo Adesanya

By Adedapo Adesanya

Afriland Properties Plc helped the NASD Over-the-Counter (OTC) Securities Exchange record a 0.04 per cent gain on Tuesday, December 10 as the share price of the property investment rose by 34 Kobo to N16.94 per unit from the preceding day’s N16.60 per unit.

As a result of this, the market capitalisation of the bourse went up by N380 million to remain relatively unchanged at N1.056 trillion like the previous trading day.

But the NASD Unlisted Security Index (NSI) closed higher at 3,014.36 points after it recorded an addition of 1.09 points to Monday’s closing value of 3,013.27 points.

The NASD OTC securities exchange recorded a price loser and it was Geo-Fluids Plc, which went down by 2 Kobo to close at N3.93 per share, in contrast to the preceding day’s N3.95 per share.

During the trading session, the volume of securities bought and sold by investors increased by 95.8 per cent to 2.4 million units from the 1.2 million securities traded in the preceding session.

However, the value of shares traded yesterday slumped by 3.7 per cent to N4.9 million from the N5.07 million recorded a day earlier, as the number of deals surged by 27.3 per cent to 14 deals from 11 deals.

Geo-Fluids Plc remained the most active stock by volume (year-to-date) with 1.7 billion units sold for N3.9 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.5 million units worth N5.3 million.

Also, Aradel Holdings Plc remained the most active stock by value (year-to-date) with 108.7 million units worth N89.2 billion, followed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.5 million units sold for N5.3 billion.

Economy

Naira Trades N1,542/$1 as FX Speculators Dump Dollars in Panic

Published

8 hours ago

11/12/2024

Adedapo Adesanya

By Adedapo Adesanya

The Naira continued to appreciate on the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM), gaining 0.7 per cent or N10.23 on Tuesday, December 10 to trade at N1,542.27/$1 compared with the preceding day’s N1,552.50/$1.

The Central Bank of Nigeria (CBN)-backed Electronic Foreign Exchange Matching System (EFEMS) platform introduced to tackle speculation and improve transparency in Nigeria’s FX market has been attributed as the source of the Naira’s appreciation.

Speculators holding foreign currencies, particularly the US Dollar, have seen the value of their money drastically drop due to the appreciation of the local currency. This is forcing them to dump greenback into the system and take the domestic currency alternative- a move that has seen available FX increase.

Equally, the domestic currency improved its value against the Pound Sterling in the official market during the trading day by N6.81 to sell for N1,955.12/£1 compared with Monday’s closing price of N1,961.93/£1 and against the Euro, it gained N10.84 to close at N1,613.00/€1, in contrast to the previous day’s rate of N1,623.84/€1.

Data from the FMDQ Securities Exchange showed that the value of forex transactions significantly increased yesterday by $228.85 million or 257.2 per cent to $401.17 million from the preceding session’s $112.32 million.

However, in the parallel market, the Nigerian currency weakened against the US Dollar on Tuesday by N5 to settle at N1,625/$1 compared with the previous day’s value of N1,620/$1.

In the cryptocurrency market, Dogecoin (DOGE) lost 4.8 per cent to sell at $0.39116, Litecoin (LTC) depreciated by 3.3 per cent to trade at $110.25, Binance Coin (BNB) went south by 2.3 per cent to $681.44, Ethereum (ETH) dropped 1.6 per cent to finish at $3,671.08, and Cardano (ADA) slid by 0.5 per cent to $0.8837

Conversely, Ripple (XRP) jumped by 5.4 per cent to $2.23 amid a continued shift for the coin with its parent company seeing the benefits of a crypto-friendly regulatory environment for US-based companies.

XRP is closely related to Ripple Labs, a high-profile payments company targeted by the SEC in 2020 on allegations of selling the token as a security to U.S. investors. Ripple fully cleared a long-drawn court case in 2024.

Further, Solana (SOL) expanded by 0.8 per cent to $219.75, Bitcoin (BTC) grew by 0.4 per cent to $97,446.95, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.