Oando Plc has announced a 40% increase in oil production following its acquisition of the Nigerian Agip Oil Company (NAOC). The company revealed this in its unaudited financial report for the nine months ending September 30, 2024, noting that production increased from 22,000 barrels of oil equivalent per day (boepd) to 30,675 boepd since the acquisition was finalized in August.
Group Chief Executive of Oando, Wale Tinubu, attributed the growth to swift operational adjustments. “Since the acquisition of Nigerian Agip Oil Company, we have increased production by 40 per cent, growing from 22,000 boepd pre-acquisition to 30,675 boepd currently. This progress has been driven by the deployment of quick-win strategies that have enhanced operational efficiencies and demonstrated the transformative potential of the acquisition,” Tinubu said.
He also noted that the integration process is advancing smoothly, with a focus on maximizing the value of the expanded portfolio. “With this stronger foundation and a clear roadmap for growth, we are confident in our ability to deliver long-term, sustainable value to all stakeholders,” Tinubu added.
In August, Oando completed the $783 million acquisition of a 100% shareholding interest in NAOC from the Italian energy company, Eni. This transaction significantly increased Oando’s participating interests in four key oil mining leases (OMLs 60, 61, 62, and 63) from 20% to 40%.
The acquisition also expanded Oando’s asset base to include 40 discovered oil and gas fields, 24 of which were in production as of August, along with substantial infrastructure, including 1,490 km of pipelines, three gas processing plants, and the Brass River Oil Terminal. The deal nearly doubled Oando’s total reserves from 505.6 million barrels of oil equivalent (MMboe) to 1 billion barrels of oil equivalent.
Despite the growth in production, Oando faced operational challenges during the first nine months of 2024, with crude production dipping to an average of 20,560 boepd, compared to 21,529 boepd in the same period in 2023. The company attributed this decline to increased sabotage and oil theft in the Niger Delta, which led to well shut-ins and reduced output.
“Our production in 2024 consisted of 6,525 barrels/day of crude oil, 254 bbl/day of natural gas liquids, and 13,782 boe/day of natural gas,” the company stated.
Oando reported a 36% increase in revenue to ₦3.2 trillion and a profit after tax of ₦76.3 billion for the nine-month period, despite ongoing challenges such as pipeline vandalism, theft, and foreign exchange volatility. The company noted that the revenue boost was partly driven by exchange rate adjustments and higher crude oil volumes, offset by lower trading volumes and reduced natural gas and natural gas liquids (NGL) prices.
Capital expenditure for the development of oil and gas assets during the period stood at $12.7 million, a significant drop from the $47.4 million spent in the same period last year.
Oando’s management remains optimistic about the future. “We achieved these results amidst a challenging operating environment, underscoring our resilience and unwavering focus on delivering value,” the company stated.
With a robust strategy in place and an expanded portfolio of assets, Oando is poised to strengthen its position in Nigeria’s oil and gas sector and deliver sustainable growth for its stakeholders.
