BY BAMIDELE FAMOOFO
Oando Plc, Nigeria’s leading indigenous energy group listed on both the Nigerian and Johannesburg Stock Exchange, on Wednesday announced audited results for the 12 months period ended December 31, 2020.
Oando’s audited financial reports belatedly submitted to the Stock Exchange this week showed a decrease in turnover to the tune of 17 percent to N477 billion compared to N577 billion in 2019.
Loss-after-tax stood at N141 billion compared to a loss of N207 billion recorded in 2019 as borrowings rose by 16 percent to N420 billion compared to N362 billion in 2019.
Commenting on the results Wale Tinubu, Group Chief Executive, Oando Plc, attributed the losses to asset impairments resulting from economic downturn in the period and the internal rumbles with some of its major shareholders. His words: “The conclusion of our Full Year 2020 audit confirms our earlier published 2020 unaudited financial statements in which we announced negative earnings driven by asset impairments resulting from a combination of the impact of COVID-19 pandemic, and the regrettable, unfair, and coerced settlement of a long-standing shareholder issue.”
Tinubu argued that the global pandemic had a profound impact on the entire oil and gas industry, leading to a sharp decline in energy demand and consequently, lower oil prices.
“As a result, we had to reassess the carrying value of our assets and investments, resulting in non-financial impairments. Furthermore, the second tranche funding of the settlement of a protracted and disruptive shareholder issue resulted in us taking a further impairment on a category of our financial assets,” he said.
During the 12 months ended December 31, 2020, production was 44,550 boe/day, compared to 42,492 boe/day in 2019. In 2020, production consisted of 15,912 bbls/day of crude oil, 1,757 boe/day of NGLs and 161,288 mcf/day (26,881 boe/day) of natural gas.
The increase in production was a result of increased natural gas production at OML 60-63 (22%) offset by 29 percent decrease in NGL production and 5 percent and 16 percent crude production decreases at OML 56 and OML 13 respectively. Production decreases were a result of shut-ins for repairs, maintenance and sabotage incidences at the facilities.
During the 12 months to December 31, 2020, Oando spent $83 million on capital expenditures related to the development of oil and gas assets and exploration and evaluation activities, compared to $79 million in the twelve months to December 31, 2019.
Capital Expenditures in 2020 consisted of $80 million at OMLs 60 to 63 incurred on oil and gas properties, $2 million at OML 56 and $1 million capital expenditure recorded on other assets.
