Seplat’s production returns to pre-force majeure levels as Forcados resumes

09 Jun 2017
Financial Nigeria

Summary

“Our focus now is on restoring production and cash flow momentum whilst also establishing longer-term access to multiple export routes,” Seplat's CEO Austin Avuru said.

Seplat CEO Austin Avuru

Seplat Petroleum Development Company has announced that its oil production has returned to normal levels following the lifting of the force majeure on the Forcados terminal, according to a statement released on Thursday.

On Wednesday, Shell Petroleum Development Company of Nigeria announced that it had lifted force majeure on crude oil exports from the Forcados oil terminal after the completion of repair works to the leaks on the export line.

The terminal had been shut down since last year, forcing Seplat to report a full-year loss of $166 million in 2016 and a loss of $19.14 million in the first quarter of 2017.

With the resumption of exports from the terminal, however, Seplat said gross production at OMLs 4, 38, and 41 has reached pre-force majeure levels of around 75,000 barrels of oil per day (bopd) and 290 million standard cubic feet of gas per day (MMscfd). On a net working interest basis, the company said this equates to around 34,000 bpd and 130 MMscfd.

“The resumption of exports at the Forcados terminal has enabled us to very quickly de-constrain production, and in doing so once again demonstrate Seplat’s strong underlying fundamentals,” said Austin Avuru, Seplat’s CEO.

The Forcados terminal has an export capacity of 400,000 bpd and it also accounts for over 90 percent of Seplat’s total exports. The company said it is currently working on other alternative export routes, particularly through two jetties at the Warri refinery and the 160,000 bpd Amukpe to Escravos pipeline.

“Our focus now is on restoring production and cash flow momentum whilst also establishing longer-term access to multiple export routes,” Avuru said. “Whilst the lifting of force majeure is welcome news we continue to monitor the situation closely.”


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