Oando Raises Turnover by 26%, PAT by 117% in 6 Months

By Modupe Gbadeyanka

Leading indigenous energy group in Nigeria, Oando Plc, on Monday announced its audited results for the six months period ended June 30, 2017.

It is no doubt that the first half of this year witnessed the country’s production levels steadily recovering to normalcy largely due to relative peace in the oil-rich Niger Delta region.

In addition, the more recent resumption of activity on the Trans Forcados Pipeline has resulted into increase in the volume of oil produced by the nation.

There is also optimism around the approval of the Petroleum Industry Governance and Institutional Framework Bill (PIGB), which should result in a more efficiently regulated sector and a conducive business environment for industry players.

During the period under review, Oando Plc recorded an increase in its turnover by 26 percent, closing at N267.1 billion compared with N213.3 billion recorded in the first half of last year.

Also, its gross profit recorded a growth of 76 percent, finish at N33.4 billion on June 30, 2017, against N19 billion in the corresponding period of 2016.

Furthermore, the oil company posted a profit after tax of N4.6 billion in contrast to N26.9 billion loss it recorded a year ago, indicating a rise by 117 percent.

Commenting on the financial statements, the Group Chief Executive Officer of Oando Plc, Mr Wale Tinubu, stated that, “With security concerns in the Niger Delta receding, Nigeria’s economic recovery has been buoyed by a boost in oil output, while the legislative approval of certain segment of the Petroleum Industry Bill (PIB) provides greater long-term policy certainty for the sector.

“Our returns underline our continued successful foray into the upstream. Within the prevalent crude price regime, we remain committed to optimising out overall production base, seeking unique profit-driven opportunities to further partner with IOCs, while firming up our balance sheet to provide greater shareholder value.”

It was disclosed that Oando Energy Resources (OER) recorded an average production of 39,950 boe/day compared with 44,892 boe/day in the first half of 2016. This reduction was primarily due to significant reductions in gas production and delivery caused by a ruptured Gas Transmission System (GTS-4) gas line, which supplies the firm’s contractual gas to the Nigerian Liquefied Natural Gas Limited (NLNG).

Also, the Trans Forcados Pipeline continued to suffer downtime in the first five months of the year and due to repairs and planned maintenance activities which resulted in reduced production from Ebendo.

In June 2017, the company successfully realised N3.2 billion in net cash from the crystallisation of the Corporate Facility hedges (1,590 bbls/day) via early settlement with hedging counterparties N3.5 billion relating to settlement of hedges offset against N336.5 million representing the cost of the planned reset, which will be utilised in paying down its existing debt obligations.