AdminSavannah Energy Plc, the British independent energy company, has announced its audited results for the year ended 31 December 2023, revealing an increased customer diversification in Nigeria.
The results show that the company recorded an average gross daily production of 23.6 thousand barrels per day (kboepd), broadly in line with FY 2022 production on a like-for-like basis when adjusted for a planned maintenance programme.
Join our WhatsApp ChannelThe results also revealed that Savannah Energy exceeded its previously issued financial guidance for the year with total revenues standing at US$260.9 million as of 31 December 2023, being 11 per cent ahead of previously issued guidance of greater than US$235 million.
Likewise, its operating and administrative expenses for the year came to US$68.8 million, 8 per cent below previous guidance of up to US$75.0 million, with its capital expenditure at US$13 million, well below the previously issued guidance of up to US$30 million.
The company also maintained its strong safety record in 2023, with a zero Lost Time Injury rate.
The report further showed a continued increase in customer diversification in Nigeria with gas sold to nine customers, and a number of new and extended sales agreements signed, totalling up to 101 MMscfpd, with an average realised sales price of US$4.51/Mscfe, representing an over 9% increase on the previous year’s average realised price of US$4.14/Mscfe.
During FY23, the company signed an agreement with Amalgamated Oil Company Nigeria Limited to purchase up to 20 MMscfpd of gas over the course of the next 10 years for onward sale to its gas customers, providing a commercial route to market for third-party stranded gas resources via its 260km pipeline network. Also its US$45 million compression project in Nigeria remains on track, with front-end engineering design and the associated order of long lead items completed in Q4 2023, with completion target of H2 2024, which will enable the company to maintain and grow its gas production levels.
Savannah’s strong Nigerian gas sales momentum continued in 2024 with a 12-month contract extension signed in January 2024 with FIPL to supply up to 65 MMscfpd to their FIPL Afam, Eleme and Trans Amadi power stations. Also its subsidiary, Accugas’ refinancing process is well underway with new Naira facility signed in early 2024, which is being progressively drawn down during the year and utilised towards repayment of the existing Accugas US$ facility.
It signed agreements in March 2024 to acquire 100 per cent of Sinopec International Petroleum Exploration and Production Company Nigeria Limited (“SIPEC”), whose principal asset is a 49 per cent non-operated interest in the Stubb Creek oil and gas field, Nigeria, consolidating its interest in the asset. Plans are also in place to double production to approximately 4.7 Kbopd within 12 months following completion of the acquisition through the implementation of a de-bottlenecking programme.
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A strong believer in Africa’s transition to renewable energy, Savannah also undertook up to 696 MW of renewable energy projects in motion at year-end, and is targeting a portfolio of up to 1 GW+ of renewable energy projects in motion by end 2024 and up to 2 GW+ by end 2026.
Commenting on the 2023 financial year report, CEO of Savannah Energy, Andrew Knott said it is a clear demonstration of the robustness of their business model, corporate capacity and corporate infrastructure.
“Our core business continued to perform strongly, while we have progressed our projects in Niger during a period of political change, progressed two separate hydrocarbon acquisitions which are material to our business, continued to grow our renewable energy business, managed the impact of the nationalisation of our Chad Assets to ensure that we receive the value we are due and positioned ourselves strongly to announce further new and exciting projects in 2024,” Knott stated.
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