Seplat to increase shareholders’ value with $700 million gas investment
As part of efforts to increase shareholders’ return on investment, Seplat Development Company Plc has announced plans to accelerate the development of its $700 million ANOH investment to deliver first gas by the first quarter of 2021.
According to the company, the project is funded through equity of $420 million, among other financing options, with government offsetting $210 million, while the remaining would be funded by Seplat.
Addressing stockbrokers at the “Facts Behind the Project” held in Lagos at the weekend, the Managing Director of the company, Austin Avuru, said that the government has already paid $150 million out of the estimated $210 million.
“Government has already paid $150 million and when you compare the sustainability of the project with the government’s risk, the biggest risk is whether they will pay up the money with the equity. It is only $60 million that is left,” he said.
He pointed out that the project when completed, would enable the company to produce 800 million gas per day, which would ultimately account for 40 percent of total domestic gas production in Nigeria.
According to him. the project is such that 50 percent is situated in the vicarage that belongs to Shell OML21 while the remaining half is in the Seplat JV vicarage of OML 53.
Furthermore, he added that one would be operated by Shell as a conventional joint venture concept while the other would be developed by under Seplat JV which would be functioning as a sole midstream entity.
“Earlier this year, we took FIB to put in along with our partner, an additional $700 million to build a gas plant in Imo state. You measure the potential growth of an eCommerce not by the energy it produces and sells to the outside world but by the energy it consumes and one of the main energy security is gas.
“The attention to displace diesel-generated power with gas will save the consumer and the economy a lot of money and that is the huge potentials we saw in has production and we are in the front of the business,” he added. The Managing Director of AGPC, Yetunde Taiwo, said ANOH or AGPC will build a 300 million plant which would be on a commercial construct of buying wet gas from the upstream as well as managed and operated by a shell.
“Government talks about the gas development project, this is one of it and it is the foremost coming ahead of the remaining six gas developing projects.
“We are excited about it because it is one of the priorities of the government and we are the strategic partner in NGC which is the has the company of NNPC. It gives us the excitement that we are in the forefront of the project.
“The timing of the upstream which is the source to the plant is very much planned as a unit and it has been factored in such that the well are going to be ready by the time the ANOH plant would be ready,” Taiwo said.
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