Seplat Energy generates over $1bn operating cash flow

…Slashes net debt 43%

Seplat Energy Plc reported a surge in operating cash flow to over $1 billion for the first nine months of 2025, allowing Nigeria’s leading independent energy producer to cut net debt by 43 percent and raise its quarterly dividend by more than 60 percent.

The company’s unaudited results showed that after-tax cash flow from operations rose 183 per cent year-on-year to $1.01 billion, supported by strong crude liftings, expanded offshore operations, and disciplined cost control. Net debt dropped to $386 million from $676 million in the previous quarter, improving Seplat’s net leverage ratio to 0.27 times EBITDA, well below its target ceiling of 1.0x.

Revenue tripled to $2.18 billion in the nine months ended Sept. 30, compared with $715 million a year earlier, while adjusted EBITDA jumped 190% to $1.11 billion. Profit before tax rose 133% to $570 million, even as Seplat faced higher royalties and maintenance expenses from its expanded portfolio following the integration of former Mobil Producing Nigeria Unlimited (MPNU) assets.

“We have delivered a third consecutive quarter of production growth and generated over $1 billion in after-tax operating cash flows,” Roger Brown, chief executive officer of Seplat. “This enabled significant deleveraging and supports our commitment to increased shareholder returns.”

The board declared a third-quarter dividend of 7.5 US cents per share, comprising a 5.0 cent base payout and a 2.5 cent special dividend, up 63% quarter-on-quarter and more than double the year-earlier payout. Seplat said its robust cash generation aligns with its new dividend policy announced at its September Capital Markets Day, which targets $1 billion in cumulative dividends by 2030.

The company used the windfall to pay down debt aggressively. During the period, Seplat repaid and cancelled its Westport junior facility, refinanced its senior reserve-based loan at a lower interest rate, and cleared the remaining $100 million balance on its revolving credit facility, which now remains fully undrawn.

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At quarter end, gross debt stood at $965.7 million, down from $1.38 billion at end-2024. Cash at bank rose 23 percent to $579.8 million, excluding $135.4 million in restricted cash.

Average working-interest production rose to 135,636 barrels of oil equivalent per day (boepd), up 185 percent from the same period last year. Offshore volumes, which now account for roughly 60% of total output, benefited from the ongoing idle-well restoration program that has brought 33 wells back online this year, adding about 33,400 barrels per day in gross capacity. Onshore production climbed 18% year-on-year to 55,299 boepd, supported by improved uptime on the Trans Escravos and Amukpe-Escravos pipelines.

Third-quarter output averaged 137,888 boepd, 1 percent higher than the previous quarter, with onshore production up 5% and offshore volumes dipping slightly due to scheduled maintenance on the East Area Project platform. Seplat narrowed its full-year production guidance to the upper end of 130,000–140,000 boepd.

In the gas segment, production rose 68 percent to 47.7 billion standard cubic feet, boosted by higher uptime at the Oben and Sapele plants. The ANOH gas processing plant, a key growth project, remains on track for first gas in the fourth quarter.

Average realised crude price fell 13% to $71.93 per barrel amid softer Brent benchmarks, but this was offset by higher production volumes and stronger NGL and gas prices during the third quarter. Unit operating costs were $14.1 per barrel of oil equivalent, within Seplat’s guidance of $14–$15/boe.

The company booked a 148 percent increase in gross profit to $879.5 million, while operating profit surged 159% to $711 million. Despite higher non-production costs, including royalties, depreciation and regulatory fees, margins remained strong thanks to operational scale and improved efficiency.

Seplat reported a 21 percent reduction in carbon emissions intensity from its onshore operations to 25.2 kilograms of CO₂ per barrel of oil equivalent. It remains on track to eliminate routine flaring onshore by the end of 2025. The company also commissioned its first liquefied petroleum gas (LPG) cargo to the domestic market, part of its effort to expand access to cleaner cooking fuels.

However, operations were briefly disrupted by a fire on the Yoho production platform in late September. The incident caused no injuries but is expected to trim fourth-quarter output by about 10,000–12,000 boepd. “The event reinforces our decision to prioritize additional investment in asset integrity,” Brown said.

Seplat reaffirmed its commitment to capital discipline, narrowing full-year capital expenditure guidance to $270–$290 million. The company remains focused on completing its Petroleum Industry Act conversion process and delivering on its 2030 roadmap, which targets 200,000 boepd in working-interest production and expanding its role as a major domestic gas supplier.

“Our performance this year underscores our ability to operate at scale and deliver sustainable value to shareholders,” Brown said.