The oil and gas index has recorded over 100 per cent year-to-date (YTD) return making the sector the best-performing in the bourse in the year. To sustain the performance, shareholders have urged the government to maintain policy stability and grow local content.
The improved performance is in addition to the 98.29 per cent gain it recorded in 2023 making the sector the best-performing. The sector has so far outperformed the all-share index, which measures the performance of listed equities and four other major indices – banking index, consumer goods index, industrial index and insurance index.
As at the close of trading on October 4, the sector dominated in performance, returning 105.8 per cent gain to shareholders, while the consumer goods index trailed with 40.04 per cent.
The insurance index returned a 35.93 per cent gain to investors. The industrial index appreciated by 32.16 per cent. The all-share index of the Nigerian Exchange Limited (NGX) gained 30.42 per cent. The banking index also advanced by 3.3 per cent.
Since 2015, the index has been in a negative position – a situation that has been of great concern to shareholders who wait patiently for a turnaround in the sector.
From 2015 to 2020, the sector has been on the decline. Analysts linked the 2021 rebound to the passage of the Petroleum Industry Act into law, which paved the way for several positive developments to take place in the sector.
The PIA is an all-encompassing piece of legislation, which is expected to consolidate the major structural changes that the oil and gas sector has been undergoing.
Another recent event that recently propelled a turnaround in the sector is Oando’s successful completion of its acquisition of Nigerian Agip Oil Company Limited (NAOC Ltd) from Eni for $783 million in August 2024.
In June 2015, Oando Plc stock began to decline, reaching an all-time low in March 2020, when its share price fell to N2. However, after the successful deal this year, Oando began its resurgence following the release of its annual financial statements for 2022 and 2023.
Oando began the year with a share price of N10.5 and has gained 567 per cent to close yesterday’s trading at N70 per share.
Another firm under the sector, Seplat Petroleum Development began the year with a share price of N2,310 and gained 126 per cent to close at N5,217.2 yesterday.
Also, Conoil began the year with a share price of N83.90 kobo. The firm closed yesterday’s trading at N168, adding 100 per cent. MRS Oil began the year with a share price of N105 and gained 26.4 per cent to close at N132.7 kobo yesterday.
Head Equity, Planet Capital, Dr Paul Uzum, said petrol marketing companies (downstream) are responsible for the growth in the NGX oil and gas sector as the rise in petrol prices increased their turnover and profit margin last year.
