Seplat Petroleum Development Company Plc said it had deferred three planned exploration/appraisal wells targeting longer-term oil and gas production and the Oben and Sapele Liquefied Petroleum Gas projects to 2020.
The company said it had revised its 2019 capital expenditure guidance downwards to $150m with current focus on shorter-term oil and gas production gains.
In its unaudited consolidated financial report for the first half of 2019, Seplat said its policy of creating multiple export routes for all of its assets had resulted in its actively pursuing alternative crude oil evacuation options for production at Oil Mining Leases 4, 38 and 41.
To add to the Trans Forcados Pipeline system and the backup export through the Warri refinery, the Amukpe-Escravos pipeline, with a capacity of 160,000 barrels of oil per day, the firm said it would provide a third export option for liquids production.
According to Seplat, the pipeline owners, the National Petroleum Investment Management Services (a 100 per cent subsidiary of Nigerian National Petroleum Corporation), Pan Ocean Corporation Limited and Fenog Nigeria are responsible for the completion of the pipeline, which has seen delays to date.
It said, “The completion of the project is in sight. The hydro testing of the 20-inch pipeline which involves pigging to remove any debris that has accumulated in the construction, followed by flowing water under pressure from the injection point at Amukpe to the Escravos terminal, commenced in early July, and the current flow rates have confirmed the integrity of the pipeline.
“Final works within the Escravos terminal are underway, which includes the tie-in of the LACT measurement unit into the Chevron control system and with commissioning expected to be completed during the third quarter of 2019 with export of oil to the permitted capacity of 40,000boepd in the fourth quarter of 2019.”
Seplat said its overall working interest production in the first half across all blocks stood at 22,974bopd and 145 million standard cubic feet per day, or 48,004boepd with production uptime of 88 per cent in the period.
The company’s half-year profit before deferred tax rose to $121m (N37bn) from $105m (N32bn) in the first half of 2018.
The Chief Executive Officer, Seplat, Mr Austin Avuru, said the results further emphasised the strong cash generation potential of the company’s low-cost production base and the progress being making at the Assa North/Ohaji South gas and condensate development project.
He said, “Our H1 work programme has been impacted owing to unforeseen delays from rig contractors as well as the need to undertake higher levels of maintenance and asset integrity work for longer-term benefit of the assets.
“Both have affected production during the H1 but we have now secured the necessary rig capacity for the second half to implement the revised work programme, which will drive us towards a 2019 exit working interest production rate of 62,000 barrels of oil equivalent per day and bring annualised production within the unchanged guidance range of 49,000 to 55,000boepd.”
