Seplat Energy Plc Chairman, Dr. ABC Orjiako, will be retiring as the chairman of the company and from the Board of Directors of Seplat Energy. Orjiako who notified the Board of Directors of his decision on November 17, 2021, extended his stay by six months  in order to facilitate a seamless transition at the next Annual General Meeting of the company scheduled to take place on  May 18, 2022, when an Independent Chairperson will take over.
Orjiako is a graduate of the University of Calabar where he obtained an M.B.B.Ch. degree in 1985 from the College of Medical Sciences. He later trained as a General Surgeon at the Lagos University Teaching Hospital and subsequently, sub-specialised in orthopaedic and trauma surgery. After 11 years active medical practice, he ventued into full-time business in 1996. In 2006, he completed the OPM program of the Harvard Business School.

Since 2009, Orjiako who is the co-founder and pioneer of Seplat Energy, has taken the company through a number of acquisitions and was the driving force behind Seplat Energy becoming the first and only Nigerian corporate to dual list on the Nigerian Stock Exchange (NSE) and the main Board of the London Stock Exchange (LSE) in 2014.
“The past twelve years at Seplat Energy have been exhilarating for me.  As Chairman, I am proud that the Board, Management and entire Staff of Seplat Energy were able to achieve several enviable milestones and exceptional successes, notably the acquisition of eight oil and gas assets, expansion of the Oben and development of the ANOH gas plants and the dual listing on both the Nigerian and London Stock Exchanges – a first by a Nigerian company”.
“While there were challenges along the way, we overcame these by the special grace of God, the outstanding performance and professionalism of each member of the Board and Management, and the sterling efforts of our staff.  I will continue to give my utmost energy and commitment to the Company until I step down from the Board at the next AGM,” he said in a statement announcing his decision to step down as Chairman of Seplat Energy.
Orjiako’s decision to step down and be replaced by an Independent Chairperson is a testament to the strong corporate governance and best practices he instilled in the Board.
The strategic focus of Seplat Energy till  date  under the leadership of  Orjiako has been commendable. Notable amongst these were the Initial Public Offer (IPO) vision, production growth, reserve addition, corporate governance, et cetera. These were preceded by the execution of the Seplat SPA on January 29, 2010 with SPDC/Total/Eni, to signal the landmark acquisition of OMLs 4, 38 and 41. This transaction tested Seplat’s negotiation skills, but it managed to settle at $340m with differed consideration of $33m, down from $760m, at which SPDC pitched the divestment.

“While there were challenges along the way, we overcame these by the special grace of God,

Also, Orjiako has led a strategic vision to enable the Board derive its bearing in creating the solid foundation Seplat Energy now has. This resulted in refinancing of acquisition cost in 2011, as well as the template for acquisition strategy the same year; funding strategy for Seplat Energy, including the credit line of $550m led by Afrexim Bank in 2011; recovery of 300k barrels post installation of flow meter in Q1 in 2011; and 2 million barrels of crude oil from Shell following post installation of Lact Unit later in 2011.
The company also raised $1.6 billion from 9 banks (both Nigerian and international banks) for ConocoPhilips bid round in 2012. This was followed by  pre-IPO funding and enterprise valuation of the company to $1billion (2012/2013), enabling M&P spin off MPI which they listed in Euronext as well as the successful IPO and corporate implementation of corporate restructuring of the company in 2014.
In 2015, Seplat Energy under the leadership of Orjiako, had Corporate Governance Training sessions by IMD and set up the Corporate Governance Policies and Standards.  Orjiako further initiated Board Evaluation Reports by Heindrick & Struggle to usher in High Performance Board Matrix. More so,  he spurred the company to the development of appropriate pricing framework for domestic gas in Nigeria, to drive its gas commercialisation, which led to the creation of its midstream business, starting with the flagship Oben gas plant.
Other milestones recorded by the company under Orjiako’s focused leadership include  the raising of $3b debt, preparatory for Shell divestment of OMLs 29 and 24; acquisition of Chevron assets with operatorship, which  was renegotiated to price reduction of $113m, and differed payment of 3 years which never materialised. This acquisition brought about the opportunity for the Assa North /Ohaji South project.

Operational Efficiencies

When some of the International Oil Companies (IOCs) operating in Nigeria divested some of their assets to indigenous oil and gas companies years ago, there was palpable fear among some stakeholders that it was going to be mission impossible. The notion then was that indigenous companies did not have the technical know-how, the  expertise and the financial resources to man the divested assets. All that have been demystified by Nigerian independents with Seplat leading the pack under Orjiako’s leadership.
At the time of acquisition, the company’s gross operated liquids production at Oil Mining Leases (OMLs) 4, 38 and 41 was 14,000 bopd. But the company, through the implementation of a focused re-development work programme and drilling campaign, grew this to a peak rate of over 84,000 bopd, representing a six-fold increase and significantly ahead of the peak rate achieved by the previous operator of approximately 56,000 bopd in 1996.
Through Orjiako’s strategic leadership, Seplat Energy presently accounts for about 30 percent of gas used by power generating companies in Nigeria.
Q1 2022 Reports
In its recently-released unaudited results for the three months ended 31 March 2022, the NGX and LSE-listed company

recorded a rise in profit before tax by 197.8 per cent to N34.7bn from N10.6bn year-on-year.
The company also generated cash from its operations to the tune of N74.4bn from N1.7bn year-on-year, rising by 197.8 per cent.
Additionally, it grew in revenue by 58.6 per cent to N100.6bn from N57.9bn year-on-year; as its gross profit soars to N48.8bn from N20.1bn year-on-year, rising by 122.3 per cent.
With the Gbetiokun field at OML40 now back in production, the company was achieving average daily volumes of nearly 54 kboepd as of April 2021, and plans to add additional oil and gas wells.
Orjiako in the Q1  of 2021, led the company to achieving another milestone as Seplat Energy priced its offering of $650 million in aggregate principal amount of senior notes due 2026. &he Notes priced at a yield of 7.75 percent, representing a significant pricing reduction from its $350 million debut issuance in 2018, which priced at a yield of 9.50 percent , with a coupon of 9.25 percent.  The size represents, the largest ever Nigerian oil and gas bond issuance.
The offering was well oversubscribed with demand from 120 global investors from more than 20 countries resulting in a final overbook in excess of $1.1bn, which was 1.7 times book coverage.  Orders came from high quality institutional investors with long term commitments to Seplat as well as new institutional investors. The transaction was well received in the market and traded above par post-pricing.
“The transaction shows confidence by theinternational market in the Nigerian economy and the oil and gas sector inparticular, with a number of the investors committing to the transaction basedon the strong gas story of Seplat,” the company said in a statement.
The Global Coordinators on the transaction are Citi, J.P. Morgan, Standard Bank and Standard CharteredBank, with Natixis, Rand Merchant Bank and Société Générale acting as Joint Book runners and FCMB Capital Markets, Nedbank, United Bank for Africa and Zenith Bank Plc acting as Co-Managers.

“recorded a rise in profit before tax by 197.8 per cent to N34.7bn from N10.6bn year-on-year.

ANOH Gas Project
Under Orjiako’s leadership, Seplat Energy’s name is now synonymous with gas. The company does not only see gas investment as a panacea to addressing Nigeria’s energy deficit, it also sees it as a transition fuel amid global push towards energy transition, and has been investing heavily in gas development. Seplat Energy is currently working on   $700m ANOH gas and condensate field project. Upon completion,  it is expected to contribute significantly in addressing Nigeria’s deficit in thermal power delivery.
This project straddles OML 53 (seplat 40 per cent working interest and operator) and OML 21 (Shell JV).
The ANOH gas processing project is managed by ANOH Gas Processing Company (AGPC), an incorporated joint venture (IJV) between Seplat and the  Nigerian Gas Company, a subsidiary of the NNPC Limited. AGPC shall develop a 300 Mscfd midstream plant on OML 53 to process future wet gas production from the upstream unit.
In February 2021, seven primarily Nigeria banks agreed to provide $260 million of debt for the AGPC. The banks include UBA, Zenith, Stanbic, Fidelity, FCMB, FBN, and Access Bank.  Also under the funding arrangement, International lenders include but not limited to: SCB, RMB, Standard Bank, BHGE, and Nedbank.

Prudent Manager of Resources

Throughout these 12 years as Chairman, Orjiako has continued to prove his mettle as a prudent manager of resources. In November 2021, Seplat Energy was upgraded to ‘B’ from ‘B-‘ by Fitch Ratings on its Long-Term Issuer Default Rating (IDR).
Fitch also confirmed Seplat Energy’s Outlook to be ‘Stable’ and upgraded the Company’s senior unsecured rating for USD650 million senior notes due 2026 to ‘B’ from ‘B-’, with a Recovery Rating of ‘RR4’.
The rating agency stated: “The upgrade reflects improved financial flexibility and a strong liquidity profile following debt refinancing in 2021, which in our view will help Seplat Energy survive for more than two years of force majeure without access to the Trans Forcados Pipeline (TFP). Amukpe-Escravos Pipeline (AEP), an alternative oil export route, has been completed and is undergoing commissioning, according to Seplat, but there is no certainty around when it will ship its first oil.”
The rating incorporates the small scale of Seplat Energy’s cash flows, concentration of the company’s asset base in Nigeria (B/Stable) and a historically unstable operating environment in the troubled Niger Delta, including recurring issues with the oil transportation system. The rating also reflects moderate leverage, conservative financial policies, competitive unit profitability, end-2020 2P reserve life of 27 years, and a growing domestic gas business.
Specifically, Fitch upgraded Seplat Energy’s $650m bonds to B from B-. The upgrade reflects  Orjiako’s leadership, which has led to improved financial flexibility and a strong liquidity profile following debt refinancing in 2021. Because of Seplat Energy’s prudent approach to financial management, Fitch believes the company has built a very strong balance sheet. Even if the Trans Forcados Pipeline was in force majeure for an unprecedented two years, Seplat Energy has sufficient strength to survive and service its debt interest
Fitch view is underpinned by its view of Seplat Energy’s prudent debt management, flexibility on dividends and flexibility to deploy capex. Fitch sees Seplat Energy’s gas business as having potential to enhance cash flows, particularly after ANOH comes onstream; ANOH itself is already fully funded
Fitch lauded Seplat Energy’s ESG efforts and noted deeper communication and cooperation between local communities, the government and Seplat,  have significantly reduced the number of attacks on oil infrastructure.

MPNU Planned Acquisition

In late February, Seplat Energy announced that it has entered into a Sale and Purchase Agreement to acquire the entire share capital of Mobil Producing Nigeria Unlimited  (MPNU) for a purchase price of $1,283 million-plus up to $300 million contingent consideration, subject to lockbox, working capital and other adjustments at closing relative to the effective date
In a statement, Seplat said that the transaction cut across the acquisition of the entire offshore shallow water business of ExxonMobil in Nigeria, which is an established, high-quality operation with a highly skilled local operating team and a track record of safe operations, producing 95 kboepd (W.I.) in 2020  (92% liquids)
The MPNU portfolio primarily consists of a 40 percent operating ownership of four oil mining leases (OMLs 67, 68, 70, 104) and associated infrastructure (NNPC is the 60% partner); the Qua Iboe Terminal; one of Nigeria’s largest export facilities; and  51 percent interest in Bonny River Terminal and Natural Gas Liquids Recovery Plants at EAP and Oso.
The transaction does not include ExxonMobil’s deepwater assets in Nigeria. Seplat noted the MPNU will operate as a standalone subsidiary of Seplat Energy and upon closing and following receipt of requisite regulatory approvals, it will align MPNU with its overall strategic goals and ESG objectives
“This is a transformational acquisition for Seplat Energy that strengthens our partnership with the national oil company, the NNPC, and consummates the spirit of the newly enacted PIA.
“As a significantly larger business, with a stronger resource base and greatly enhanced capabilities, we will be better positioned to provide sustainable energy solutions that drive growth and profitability for the benefit of all our stakeholders, particularly our host communities and the wider Nigerian economy.
“We fully support the aims of the Federal Government’s “Decade of Gas”, and this acquisition will accelerate our development of Nigeria’s gas resources to help achieve a just transition for our rapidly growing country,”   said Orjiako on the acquisition plan.

Awards and Recognitions

In recognition of his leadership qualities and achievements, Orjiako has received various awards. In August 2021, Orjiako and Seplat Energy emerged winners at the Energy & Corporate Africa Leadership Award Night/Dinner held in Houston, Texas, Unite States for outstanding indigenous performance in the oil and gas.
“Since inception, Seplat has continued to strive for operational excellence and sustainable value creation for all our stakeholders. The awards will continue to propel us to greater achievements,” he said while commenting on the award.
Other awards include the Distinguished Alumnus Award and Doctor of Sciences (D.Sc. Honoris Causa) by the University of Calabar, Nigeria in 2001; Platinum Award of the West African College of Surgeons in 2006;  National Honours as an Officer of the Federal Republic (OFR) in 2012; the Zik  Prize in the Professional Leadership category by the Public Policy Research and Analysis Centre (PPRAC) and African Business Executive of the Year 2014, by the Oil and Gas Council. He also won the Sun Entrepreneur of the Year, 2020 award.
Orjiako is a patriot, an innovative leader and an entrepreneur par excellence who always wants to give his best. As he steps down from his position as the Chairman, and from the Board of Seplat Energy, his remarkable accomplishments and impacts will remain indelible in the company’s history.

“In November 2021, Seplat Energy was upgraded to ‘B’ from ‘B-‘ by Fitch Ratings on its Long-Term Issuer Default Rating (IDR).