……..McKinsey predicts massive growth for Seplat Energy
Seplat Energy Plc, listed on both the Nigerian Exchange Limited and the London Stock Exchange, has said that it is projecting to grow more given the rising demand for energy in Africa. The is building on the expectation that Africa’s energy demand would see increased growth over the decade amidst current realities.
Global management consulting firm, Mackinsey & Company disclosed this at the Seplat industry lecture and send forth event held on behalf of Seplat immediate past chairman, Dr. ABC Orjiako in Lagos last weekend.
“There will be rising demand for fossil fuels in Africa driven by industrialization and population growth. Energy demand growth will be led by Nigeria, and this will create tailwinds for energy suppliers like Seplat Energy,” associate partner and co-lead of West Africa Oil and Gas Practice, McKinsey & Company, Oliver Onyekweli, stated while delivering a lecture.
In his lecture titled “The Future of African Oil & Gas: Positioning for the Energy Transition,” the Mckinsey chief said Africa’s growing energy demand also creates opportunities for Seplat to explore renewable energy solutions, e.g. solar, blue hydrogen.
Decarbonizing production and cost leadership, he explained, will be key going forward as capital providers continue to reduce exposure to oil and gas, with customers preferencing lower carbon shipments.
Decarbonization of assets to greatest possible extent, Onyekweli added, will be needed to maintain “license to operate” and maintain access to capital at attractive rates. “As global oil demand peaks, maintaining cost leadership ($/bbl) will be increasingly vital.”
According to him, indigenous producers will define the future of African oil and gas, as IOCs will continue to face pressure to reduce carbon-intensive operations and lower cost of production, stressing that divestment is likely to continue.
“Companies like Seplat Energy are well positioned to pick up producing assets going forward, provided they can maintain operational excellence. Ensuring continued access to talent will be key,” the Mckinsey chief said.
He described African energy infrastructure is a compelling opportunity. As the energy transition accelerates, gas will become more prominent as a “transition fuel”, especially in Nigeria, he said Significant domestic gas demand is a positive tailwind for Seplat Energy’s ANOH project and gas’ cleaner carbon profile (relative to diesel) should make gas projects easier to finance (can be paired with LPG).
Investing in gas export infrastructure could create an opportunity to access high value international spot market.
Dr. ABC Orjiako, the Pioneer and immediate past Chairman of Seplat Energy, lauded all the company’s stakeholders for the huge successes recorded so far in the company since inception, saying they were products of hard-work, sleepless nights and resilience.
Commending all stakeholders of Seplat Energy for the great achievements recorded so far, the new Chairman, Seplat Energy, Mr. Basil Omiyi, said year 2022 marks a major turning point for Seplat Energy as Dr. Orjiako retires from the board after leading the company to achieving monumental milestones over the last 13 years, including nine years as a listed entity.
In his remarks, the CEO Seplat Energy, Mr. Roger Brown, said Dr. Orjiako drove Seplat Energy’s long-term imperative with regards to global transition away from fossil fuels towards cleaner and renewable energies, advocating a just transition, which is to be conducted at an appropriate pace.
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