Seplat Energy Reduces JV Stake To 30%, Sells 10% To NNPC For $281.6m

Seplat Energy Plc has agreed to sell a 10 percent working interest in the NNPCL‑SEPNU joint venture to NNPC Limited for $281.6 million, the company said, cutting its stake to 30 percent while remaining the operator.

In its unaudited results for the six months to 30 June 2026, Seplat said the sale would support shareholder returns and strengthen the balance sheet. The company said the effective date of the transaction is 1 April 2026 and completion is expected in the second half of 2026.

Seplat said the headline transaction value “represents approximately 25 percent of the gross consideration we paid for the SEPNU acquisition,” based on the company’s estimate.

Seplat’s chief executive officer, Roger Brown, said the first‑half results showed strong cash generation and improved profitability.

He said: “As I hand over leadership of Seplat, the Company is stronger than ever. Production improved from the first quarter and remains on track to grow further in the second half of 2026.”

Brown said the company used favourable oil prices to prioritise balance‑sheet strength. He said Seplat had repaid and cancelled $200 million of its Advanced Payment Facility during the period and that net debt had fallen to $370.7 million at end‑June, down 45 per cent from year‑end 2025.

On control, Seplat said: “We will retain a 30 per cent working interest and remain the operator, maintaining day‑to‑day control of field operations.”

Proceeds and dividends

Seplat said it plans to allocate the sale proceeds roughly half to debt reduction and half to a transaction dividend. The company said: “Proceeds will be split approximately 50:50 between a transaction dividend and debt repayment, subject to completion.”

Subject to the deal completing, Seplat said it will pay a transaction dividend of $140 million, equivalent to 23.3 US cents per share, on top of the ordinary dividend from operating performance.

The company said planned dividends for 2026 are now expected to total $410 million, or 68.3 US cents per share, after combining the transaction dividend with dividends tied to business performance.

Financial and operational highlights

Seplat reported strong half‑year results. The company said revenue rose to $1.82 billion from $1.398 billion a year earlier, and profit after tax climbed to $164.0 million — a 498 percent increase year‑on‑year.

Seplat said adjusted EBITDA was $939 million, up 28 percent from the prior year, and cash generated from operations reached $985.9 million, up 29 percent. End‑June cash at bank stood at $433.8 million, excluding restricted cash of $130.8 million.

Earnings per share rose to 26.6 US cents from 4.0 US cents a year earlier. The group also said net debt to EBITDA improved to 0.25x from 0.53x at the end of 2025.

On costs, Seplat reported a unit production operating cost of $15.8 per barrel of oil equivalent, driven higher by Yoho restoration costs; excluding Yoho, the company said unit costs were $14.0/boe. Cash capital expenditure for the half was $109.8 million, and the company said higher capex is expected in the second half.

Production and safety

Seplat said group production averaged 139,509 barrels of oil equivalent per day (boepd) in the first half, up 4 percent from 134,492 boepd in 6M 2025 and inside the company’s 2026 guidance of 135–155 kboepd. Working‑interest oil production was 99,518 barrels of oil per day and gas 182.9 million standard cubic feet per day.

In the second quarter, the group averaged 149,070 boepd, up 9 percent year‑on‑year and 15 percent from the first quarter. Onshore production rose to 60,690 boepd, up 11 percent year‑on‑year, while offshore output was 78,819 boepd, slightly down on the prior year.

Seplat said its idle well restoration programme added about 26,000 barrels per day of gross JV production capacity in the half, from 24 restored wells. The company also reported that group operated assets delivered 18.8 million man‑hours without a lost‑time injury in the period.

Emissions and ESG

Seplat reported improvements in emissions intensity, saying group carbon emissions fell to 33.5 kg CO2/boe, an 18 percent reduction year‑on‑year, and onshore operated emissions intensity declined 37 percent. The company linked the reduction to its End of Routine Flaring programme.

Dividends and guidance

Seplat said it declared a second‑quarter dividend of 12.0 US cents per share, comprising a 5.0 US cents core dividend and a 7.0 US cents special dividend, equating to about $72 million.

The company said planned full‑year dividend based on operating performance remains $45.0 US cents per share ($270 million), and that, subject to completion of the NNPC transaction, the total dividend for 2026 would rise to 68.3 US cents per share ($410 million).

Seplat said current production guidance for 2026 remains 135–155 kboepd and that capex guidance is unchanged at $360–440 million, with spending skewed to the second half. The company said unit operating cost guidance is revised to $14.5–$15.5/boe, reflecting higher Yoho costs.

Corporate changes

Seplat confirmed planned leadership changes. The company said Effiong Okon will succeed Roger Brown as chief executive and executive director on 1 August 2026.

It also said Tony O. Elumelu, CFR, will succeed Senator Udoma Udo Udoma as chairman on 1 January 2027.

On the results and the JV sale, Roger Brown said: “Our first‑half performance benefited from a supportive commodity price environment, translating into strong cash generation. Given the limited visibility on how long these elevated prices may persist, we prioritised balance sheet strength during the quarter, repaying $200 million of our outstanding APF debt.”

Brown added: “With continued strong business performance and the announced sale of a 10 per cent interest in our offshore JV to NNPC Limited, total dividends paid for the current financial year are expected to represent nearly 50 percent of all previous dividends paid to shareholders.”