Oando records N60.3bn 2023 profit, ramps up production

Leading energy solutions company, Oando PLC has recorded a profit after tax of N60.3 billion in its audited financials for the full year ended 2023, a substantial improvement from its 2022 financial performance.

The company recorded a 43% increase in revenue, reaching N2.9 trillion compared to N1.9 trillion in 2022.

Notably, Oando achieved a remarkable turnaround, transitioning from a loss in 2022 to a profit-after-tax of N60.3 billion in 2023, a 961% increase in its operating profits despite the 24% reduction in the realised oil price ($83.15/bbl in 2023 compared to $109.55/bbl in 2022).

This reduction was consistent in gas prices as the value fell from $14.74/bbl in 2022 to $12.19/bbl in 2023; and in NGL prices with a similar decline from $6.23/boe in 2022 to $4.87/boe in 2023. Additionally, the company reduced its upstream borrowings by 23%, from US$635.6 million in 2022 to US$488.9 million in 2023.

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Oando in a statement said it achieved a 12% increase in total production, reaching 23,258 boepd in 2023 compared to 20,703 boepd in 2022 despite “persistent security challenges” in the Niger Delta.

Expanding on the performance of its production portfolio, Oando averaged a daily production of 6,211 bbls/day, making a 26% increase to its 4,939 bbls/day in 2022.

Consistent with the improved performance, it averaged 16,808 boe/day of natural gas, 10% better than 15,292 boe/day of natural gas in 2022.

The company cited improved operations and repairs of shut-in wells offset by persistent sabotage activities as a reason for the production increase.

Group Chief Executive, Oando PLC, Wale Tinubu said: “Despite the operational hurdles occasioned by security breaches and persistent pipeline vandalism in the Niger Delta, we achieved a profit after tax of N60 billion, bolstered by the strength of our global trading alliances, a 12% increase in total production, and favourable exchange gains from our foreign currency denominated assets.

“Our recently completed transformational acquisition of NAOC Ltd is a pivotal moment for the company due to the expansive reserves and vast infrastructure network.

Following our 2014 acquisition of ConocoPhillips’s Nigerian unit, this transaction was the next phase in our long-term strategy to increase our reserves and production capacity by leveraging the exit of the International Oil Companies (IOCs) whilst securing operational control of the assets.

Our immediate focus now shifts to a seamless integration and execution of initiatives towards achieving a marked increase in production. We are confident about the opportunities this platform provides and are committed to delivering sustainable value to all stakeholders” he added.