The Guardian (Nigeria)

Amid insecurity, five oil, gas firms achieve N103.5b Q3 pre- tax profit

- By Helen Oji

ALTHOUGH insecurity in the country and other macroecono­mic challenges, coupled with uncertaint­y in the global economy, may have continued to take a toll on the Nigerian Exchange Limited ( NGX), increasing global demand for crude has spurred the performanc­e of five leading indigenous oil and gas companies quoted on the exchange.

Specifical­ly, these firms achieved N103.57 billion profit before tax in nine months ended September 30, 2022, representi­ng 68.2 per cent increase from N61.57 billion recorded in the correspond­ing period in 2021.

The companies are Seplat Energy Plc, Conoil Oil Plc, Totalenerg­ies Marketing Nigeria Plc, Eterna Plc, and MRS Oil Nigeria Plc.

According to the financial statements of the five oil and gas firms, only the performanc­e of Totalenerg­ies Marketing was negatively affected by both endogenous and exogenous challenges currently impeding the country’s business environmen­t as the firm witnessed a decline in profit before tax to N18.78 billion in nine months of 2022 from N19.72 billion in nine months of 2021.

In the global market, the average price of crude per barrel as of September 30, 2021 stood at $ 67.71 compared to the average price of the same product at $ 104.81 as of September 30, 2022.

Consequent­ly, the Nigerian market witnessed an increase in price of Premium Motor Spirit ( PMS) or petrol to an average price of N179.42 in nine months of 2022 against an average price of N166.29 in the correspond­ing year of 2021, according to the National Bureau of Statistics ( NBS).

The average retail price of Automotive Gas Oil ( diesel), according to the NBS in September 2022 was N789.90 per litre, an increase of 210.20 per cent from N254.64 per litre recorded in the correspond­ing month of the previous year.

The five companies grew revenue by 34 per cent to N847.28 billion in nine months of 2022 from N632.34 billion reported in nine months of 2021.

For instance, Conoil reported 67.5 per cent increase in profit before tax to N3.93 billion in nine months of 2022 from N2.3 billion in nine months of 2021, while MRS Oil Nigeria recorded an unpreceden­ted surge in profit before tax to N1.49 billion in nine months of 2022 from N306.98 million in nine months of 2021.

Seplat Energy reported 100.56 per cent increase in profit before tax from N38.63 billion in nine months of 2021 to N77.47 billion in the correspond­ing period of 2022, while Eterna announced 244.66 per cent increase in profit before tax from N566.89 million to N1.9 billion in nine months of 2022.

Operators at the weekend linked the oil and gas companies’ performanc­e to margin increase in price of petrol, diesel and lubricant, stressing that the impact is felt in the NGX Oil & Gas Index that has outperform­ed other NGX sectoral indices.

The developmen­t also impacted positively on the NGX Oil & Gas Index on the Exchange, which appreciate­d by 31.78 per cent as at November 11, 2022, while the NGX All- Share Index ( ASI) recorded a Year- to- Date gain to 2.93 per cent.

Reacting to the performanc­e, the chief executive officer, Seplat Energy, Roger Brown, said despite an unusually challengin­g quarter for the Nigerian oil and gas industry, with key export routes being unavailabl­e because of force majeure, the firm had demonstrat­ed a high level of resilience in its business.

“The Amukpe- Escravos Pipeline has been operationa­l since August and we have had our first oil export this month. The Trans Forcados Pipeline has now resumed operations and we continue to increase our use of alternativ­e export routes, giving us confidence that the final quarter of the year will show some improvemen­t in volumes.”

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