Economy
Seplat Able to Withstand Low Oil Prices
By Modupe Gbadeyanka
The ability of Seplat Petroleum Development Company Plc to remain strong in the face of falling crude oil prices at the global oil market has been reaffirmed.
Seplat is a company listed on both the Nigerian Stock Exchange (NSE) and the London Stock Exchange (LSE).
In recent times, the price of the company’s stock at the NSE had been declining, causing some shareholders to fret over it.
Prices of crude oil have not been too positive this year due to the coronavirus disease pandemic, which caused decline in demand for the commodity.
In April 2020, members of the Organisation of the Petroleum Exporting Countries (OPEC), as part of moves to make prices of crude oil remain green, agreed to cut global supply of the product by 9.7 million barrels per day in May and June.
This decision has helped prices to remain above $40 per barrel as at last week and on Saturday, they agreed to extend the cut to July before relaxing it in August.
Last week, one of the rating agencies in the world, Moody’s Investors Service, announced the completion of a periodic review of ratings of Seplat.
In a press statement, the agency said the Nigerian oil giant has the ability to withstand low oil prices in the near term.
According to Moody’s, this is supported by short term oil hedges and contracted gas revenue representing 29 percent of 2019 revenue.
It said in addition, Seplat’s moderately positioned credit metrics and sizable unrestricted cash balances, provide a buffer against a decline in its operating cash flow from lower oil prices over the next 18 months.
The rating organisation stressed that the leading exploration and production (E&P) firm has long-term oil and gas field licensing agreements that can make it remain stronger despite the challenges.
However, Moody’s said, “The ratings are constrained by the company’s exposure to volatile oil prices; small scale of production; concentration to a single asset block, Oil Mining Licences (OML) 4, 38 and 41 which account for 70 percent of the company’s working interest production; and operational concentration to a single country, Nigeria (B2 negative) with reliance on Nigerian government-owned entities for the timely payment of capital cash calls.
“Moody’s also note that there are significant uncertainties related to the impact of the coronavirus on the company’s credit metrics and liquidity as well as the shape of a future recovery of crude oil prices.”
Few days ago, Seplat paid over N30 as dividend to shareholders of the company for the 2019 financial year. The firm has been consistent in rewarding its investors.
Business Post reports that as at Monday afternoon, share price of the company was down by N47.60 or 9.99 percent to N428.80 per share.
By Adedapo Adesanya
Oil traded lower on Wednesday after US President Donald Trump eased fears of disruptions to Iranian supplies, indicating that killings in Iran’s crackdown on civil unrest were subsiding.
Yesterday, the price of Brent futures declined by 92 cents or 1.41 per cent to $64.55 per barrel while the US West Texas Intermediate (WTI) futures slipped 96 or 1.57 per cent to $60.19 a barrel.
Prices had risen on fears of Iranian supply disruptions due to a potential US attack on Iran and possible retaliation against US regional interests.
President Trump said on Wednesday afternoon he had been told that killings in Iran’s crackdown on nationwide protests were subsiding and he believed there was currently no plan for large-scale executions.
Still, tensions between Iran and the US remained high after Iran had warned US allies in the Middle East it would strike American bases on their soil if the US attacked it. The US began evacuating military personnel from a key Qatar air base on Wednesday.
While markets may have cooled somewhat on the back of President Trump’s comments, protests in Iran have persisted, and there remains plenty of uncertainty over what might come next.
Market analysts noted that continued protests in Iran risk tightening global oil balances through near-term supply losses, but mainly through rising geopolitical risk premium.
However, this remains somewhat minimal as the protests had not spread to the main Iranian oil-producing areas, which had limited the effect on actual supply.
Also supporting oil prices, Federal Reserve Bank of Minneapolis President Neel Kashkari said on Wednesday he was optimistic about the economic outlook and expected inflation to ease.
It is also looking increasingly likely that Venezuela’s oil supply is set to return to markets, with the US completing its first sale of Venezuelan oil on Wednesday.
Two supertankers departed Venezuelan waters on Monday with about 1.8 million barrels each of crude in what may be the first shipments of a 50 million-barrel supply deal between Venezuela and the US to get exports moving again following the capture of Venezuelan President Nicolas Maduro.
Crude oil inventories in the US increased by 3.4 million barrels during the week ending January 14, according to new data from the US Energy Information Administration (EIA) released on Wednesday.
The EIA’s data release follows figures by the American Petroleum Institute (API) that were released a day earlier, which suggested that crude oil inventories grew by 5.27 million barrels.
By Adedapo Adesanya
TotalEnergies EP Nigeria has signed a Sale and Purchase Agreement with Vaaris for the divestment of its 10 per cent non-operated interest in the Renaissance JV licences in Nigeria.
The Renaissance JV, formerly known as the SPDC JV, is an unincorporated joint venture between Nigerian National Petroleum Company Limited (55 per cent), Renaissance Africa Energy Company Ltd (30 per cent, operator), TotalEnergies EP Nigeria (10 per cent) and Agip Energy and Natural Resources Nigeria (5 per cent), which holds 18 licences in the Niger Delta.
In a statement by TotalEnergies on Wednesday, it was stated that under the agreement signed with Vaaris, TotalEnergies EP Nigeria will sell its 10 per cent participating interest and all its rights and obligations in 15 licences of Renaissance JV, which are producing mainly oil.
Production from these licences, it was said, represented approximately 16,000 barrels equivalent per day in company’s share in 2025.
The agreement also stated that TotalEnergies EP Nigeria will also transfer to Vaaris its 10 per cent participating interest in the three other licences of Renaissance JV which are producing mainly gas, namely OML 23, OML 28 and OML 77, while TotalEnergies will retain full economic interest in these licences, which currently account for 50 per cent of Nigeria LNG gas supply.
Business Post reports that the conclusion of the deal is subject to customary conditions, including regulatory approvals.
“TotalEnergies EP Nigeria has signed a Sale and Purchase Agreement with Vaaris for the sale of its 10 per cent non-operated interest in the Renaissance JV licences in Nigeria.
“Under the agreement signed with Vaaris, TotalEnergies EP Nigeria will sell to Vaaris its 10 per cent participating interest and all its rights and obligations in 15 licences of Renaissance JV, which are producing mainly oil. Production from these licences represented approximately 16,000 barrels equivalent per day in the company’s share in 2025.
“TotalEnergies EP Nigeria will also transfer to Vaaris its 10 per cent participating interest in the 3 other licenses of Renaissance JV, which are producing mainly gas (OML 23, OML 28 and OML 77), while TotalEnergies will retain full economic interest in these licenses, which currently account for 50 per cent of Nigeria LNG gas supply. Closing is subject to customary conditions, including regulatory approvals,” the statement reads in part.
The development is part of TotalEnergies’ strategies to dump more assets to lighten its books and debt.
By Aduragbemi Omiyale
The trading licence of Monument Securities and Finance Limited has been revoked by the regulatory arm of the Nigerian Exchange (NGX) Group Plc.
Known as NGX Regulations Limited (NGX Regco), the regulator said it took back the operating licence of the organisation after it shut down its operations.
The revocation of the licence was approved by Regulation and New Business Committee (RNBC) at its meeting held on September 24, 2025, a notice from the signed by the Head of Market Regulations at the agency, Chinedu Akamaka, said.
“This is to formally notify all trading license holders that the board of NGX Regulation Limited (NGX RegCo) has approved the decision of the Regulation and New Business Committee (RNBC)” in respect of Monument Securities and Finance Limited, a part of the disclosure stated.
Monument Securities and Finance Limited was earlier licensed to assist clients with the trading of stocks in the Nigerian capital market.
However, with the latest development, the firm is no longer authorised to perform this function.
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