Published On: Fri, Aug 26th, 2016

Oil company records losses after Niger Delta challenges

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SEVEN Energy International Limited,

SEVEN Energy International Limited,

LAGOS, (CAJ News) – THE prevailing setbacks in the oil and gas industry are taking its toll on the operations of Seven Energy Finance Limited, which has incurred some losses during the six months ended June 30.

The company reported during the period, Earnings before interest, taxes, depreciation, amortization and exploration (EBITDAX) of $66 million, which  shows stagnation from the corresponding period last year.

Seven energy accrued loss after tax of $4,5 million (H1 2015 loss: $53 million) while cash flow provided by operating activities was $41 million  (H1 2015: $83 million).

Phillip Ihenacho, Chief Executive Officer, Seven Energy, commenting on the results said, the macro-environment in Nigeria and the ongoing issues within the industry presented the company with an extremely challenging environment.

So far during 2016 we have received no revenue from our interests in OML 4, 38 and 41 as a result of the shutdown of the Forcados terminal, he said.

Ihenacho said while their flagship gas business, located in the south east Niger Delta, continued to increase delivery volumes, they had experienced some setbacks.

The rate at which our customers are able to bring their demand to full contractual quantities is behind schedule.

Additionally, whilst our gas sales are priced in US dollars we receive payment in Naira due to foreign currency exchange controls, which is difficult to convert to service our US dollar loans.

These factors, he said, were putting intense pressure on the Group’s liquidity.

CAJ News

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