RESILIENCE AND STRENGTH 2020 H1 RESULTS 29 JULY 2020 www.seplatpetroleum.com
2 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC INTRODUCTION Austin Avuru Chief Executive Officer www.seplatpetroleum.com
H1 2020 KEY MACROECONOMIC EVENTS An unprecedented period of volatility as twin shocks hit the oil market › Oil price recovering after twin shocks of COVID-19 BRENT FUTURES IN H1 2020 ($) demand drop and KSA-Russia price war 80 › OPEC+ cuts will reduce Seplat’s W.I. quotas in 70 July/August but little impact expected on full-year result 60 50 › Nigeria is relatively lightly affected by COVID-19 with 40 <39,000 cases reported and <900 deaths as at 25/7/20 30 › Lockdown enforced in key centres, but oil operations 20 10 allowed to continue owing to strategic and economic 0 importance 1/1/2020 2/1/2020 3/1/2020 4/1/2020 5/1/2020 6/1/2020 7/1/2020 › Very little direct impact of COVID-19 on Seplat and its operations at fields or offices, but continuing to monitor EVOLUTION OF BRENT FORWARD CURVE ($) developments Live 26/06/2020 27/04/2020 27/01/2020 60 50 40 30 20 0 0 1 1 2 2 3 3 4 4 5 5 6 6 7 7 8 8 9 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 - - - - - - - - - - - - - - - - - - - r p r p r p r p r p r p r p r p r p r a a a a a a a a a a e e e e e e e e e M M M M M M M M M M S S S S S S S S S 3 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | H1 2020 RESULTS
H1 2020 HIGHLIGHTS Seplat delivered production well within guidance and maintained a healthy cash balance despite low oil prices A STRONG PERFORMANCE DESPITE CHALLENGING MARKET KEY FIGURES › 51,177 boepd total › $34.94/bbl realised Production VOLUMES WITHIN GUIDANCE across H1 2020 › Liquids 34,117 bopd Oil price well within › Hedged put options at recovering › Gas 99 MMscfd guidance 51,177 boepd $45/bbl for Q2/Q3 and (17,060 boepd) $30/bbl in Q4 (Q1 2020: 48,491 boepd) › $86m invested H1 to › Negotiating at least 30% LOW COST PRODUCER Focus on underpin future revenues savings from suppliers, Capex cost reduction per Government request › H2 focus on gas projects increased and efficiency › Reducing barging costs US$7.60/boe › Non-essential capex at OML40, plus Group under review central costs STRONG CASH BALANCE › Balance sheet strong › ANOH remains on schedule even after capex and for Q4 2021 first gas Balance Update on dividend payments › Amukpe-Escravos Pipeline US$343m sheet major projects › All debt lines well expected in H2, subject to within headroom COVID-19 delayed works being completed 4 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | H1 2020 RESULTS
5 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC OPERATIONS UPDATE Effiong Okon Operations Director www.seplatpetroleum.com
H1 2020 WORKING INTEREST PRODUCTION Volumes are well within guidance for 2020 despite severe market challenges in second quarter boepd 60,000 FY 2020 guidance PERFORMANCE unchanged at Oil production 47-57kboepd Gas production › Average W.I. production in H1 2020: 51,177 49,867 51,177 boepd (Q1 2020: 48,491) 50,000 48,491 46,498 › Eland achieved 10,861 bopd, c32% of 43,372 Group oil volumes 17,060 › Pipeline issues affected exports from 15,103 40,000 36,924 OML 4, 38, 41 24,198 14,369 22,563 › Gas production recovering after Q1 30,823 maintenance and 3 rd party downtime 30,000 28,341 25,877 6,571 19,070 4,867 20,020 IMPACT OF OPEC+ CUTS 20,000 15,786 5,226 34,117 33,388 › No impact in H1 2020 29,003 › Seplat July production within revised 25,669 24,252 23,935 23,474 10,000 quota, August quota similar to H1 17,853 14,794 average 10,091 › No change to previous FY guidance 0 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 Q1 2020 H1 2020 6 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | H1 2020 RESULTS
UPDATE ON OPERATIONS IN H1 2020 Focus on well development and reducing costs OIL BUSINESS GAS BUSINESS › OML40 and Ubima production now included, contributing › 99 Mscfd achieved across six-month period was nearly a third of oil production significant increase on 88Mscfd achieved Jan-March › Oben scheduled maintenance and 3 rd party › 76% uptime as infrastructure outages affected OML 4,38, 41 exports; 8.6% reconciliation losses infrastructure problems restricted Q1 gas sales › Six oil wells completed across Sapele, Ovhor, Ohaji South › Oben-48 gas well completed and onstream and Gbetiokun › ANOH project still on target to produce first gas in › Cost saving initiatives underway include negotiating savings late 2021, despite COVID-19 impact from suppliers per Government request, larger barges › ANOH equity and debt financing expected to at Gbetiokun to reduce shipping costs, savings already complete in H2 2020 driving costs down from $14 to $9 per bbl › Sapele Gas Plant decommissioning in advanced › Amukpe-Escravos Pipeline expected H2 2020 due to delays stage but timetable affected by COVID-19 in accessing the terminal; expected to significantly reduce › Two gas wells on track to be drilled in H2 reconciliation and other losses, thereby enhancing revenue assurance 7 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | H1 2020 RESULTS
ACCIDENT AT BENIN RIVER VALVE STATION ON OML40 Investigation has commenced into explosion on maintenance barge SUMMARY › Seven fatalities amongst third-party contractors; our thoughts and prayers are with the families and friends of all those who lost their lives › No other casualties reported, no environmental damage › Investigation is underway, combined NPDC / Elcrest team, led by NPDC as the operator › Accident occurred on mooring dolphin at Benin River Valve Station, which is Gbetiokun crude injection point into TEP for export to Forcados Terminal › The mooring dolphin was being modified to receive a larger self-propelled barge › The BRVS is 30km away from the Gbetiokun upstream operations 8 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | H1 2020 RESULTS
9 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC FINANCIAL PERFORMANCE Roger Brown Chief Financial Officer & CEO Designate www.seplatpetroleum.com
H1 2020 FINANCIAL HIGHLIGHTS Cash balance increases, NPDC receivables fall, capex increased and 2019 final dividend paid. LOSS BEFORE DEFERRED TAX REVENUES CASH AT BANK 3% 221% 34% US$234 million US$145 million US$343 million Impact of COVID-19 and oil price fall Loss results from IAS36 impairment Cash balance strong and increasing H1 2019: $355 million H1 2019: $120 million profit FY 2019: $333 million OPERATING COSTS EBITDA NET DEBT = 40% 48% US$7.60 / boe US$115 million US$457 million Includes OML40/Ubima export cost Includes $799m gross debt After adjusting for impairment H1 2019: $5.41 / boe H1 2019: $223 million FY 2019: $456 million GAS SALES REVENUE CAPITAL INVESTMENT NPDC RECEIVABLES 206% 22% 26% US$54 million US$86 million US$174 million 23% of Group revenues Increased despite market uncertainty Good management of receivables H1 2019: $72 million H1 2019: $28 million FY 2019: $222 million 10 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | H1 2020 RESULTS
H1 2020 FINANCIAL RESULTS A profitable business with strong cash flow generation and a robust balance sheet $ million H1 2020 H1 2019 Change › H1 2020 results reflect contribution of Eland, acquired at the end of Q4 2019 Total revenue 233.6 355.1 (34.2%) › Lower oil revenues reflect price falls in Q2; average price of $34.94 achieved Cost of sales (195.9) (148.0) 32.9% across H1 with a low of $17.50 Gross profit 37.7 207.0 (81.8%) › H1 2020 gas sales did not include tolling (H1 2019: $67m); $2.88/Mscf achieved G&A (47.6) (42.1) 13.2% › In cost of sales, royalties, crude handling and DDA now includes consolidated amounts Other income 51.4 8.6 496% from Eland, including US$10.7m barging costs, but reduction in barging costs will be felt in H2 Impairments (160.9) (40.1) 301% › Operating expenses include impact of Eland consolidation, IAS36 impairment on assets to reflect the impact of oil price decline $146m in Q1 2020, and $14.8m impairment of financial assets Operating profit / (loss) (112.9) 139.1 (181.2%) › H1 2020 finance cost is made up of interest repayments impacted by interest on additional Net finance costs (34.8) (18.9) 84.2% $350m RCF in December and consolidation of Eland finance cost compared to H1 2019 (Loss)/Profit before tax (145.3) 120.4 (220.7%) › Hedging: FV gain on hedge due to significantly low oil prices Tax credit / (expense) 35.1 (1.4) (2565%) › Tax expense: H1 2020 contains a deferred tax credit of $39m and a tax charge of $3.9m (Loss)/Profit after tax (110.2) 119.0 (193%) › Capex for H1 2020 includes mainly costs for ramped up activities on Ovhor wells, Sapele and Gbetiokun oil wells, Oben-48 gas well, Sapele gas plant project and other projects Capital investment 86.0 28.1 206% › Good relationship with NPDC drives fall in receivables Cash flow from operations 176.2 255.2 (31%) NPDC receivables (vs. 31/12/19) 174.4 222.3 21.6% 11 SEPLAT PETROLEUM DEVELOPMENT COMPANY PLC | H1 2020 RESULTS
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