After a blockbuster rally in 2024 and a far more restrained performance in 2025, Seplat Energy has entered 2026 with renewed momentum. Within the first trading week of the new year, the company’s shares climbed to a fresh 52-week high of N6,171, delivering a 6.2% year-to-date gain and already outperforming its full-year return for 2025.
The early-year rally marks a notable shift from the cautious optimism that characterised the stock last year. Seplat ended 2025 with a modest 1.94% gain, a performance that looked underwhelming when compared with the more than 50% advance recorded by the Nigerian Exchange All-Share Index. However, a closer look at sector dynamics paints a more favourable picture. While the broader market surged, the Oil and Gas Sector Index declined by 1.54%, meaning Seplat outperformed most of its immediate peers in what was a challenging year for energy equities.
That relative resilience has now given way to stronger absolute gains, driven largely by a major shareholder development. The catalyst behind the recent surge was the acquisition by Heirs Energies of Maurel & Prom S.A.’s entire 20.07% stake in Seplat. The transaction involved 120.4 million shares and was valued at approximately $500 million, priced at £3.05 per share. Executed under the leadership of Tony Elumelu, the deal was widely interpreted by the market as a strong, long-term endorsement of Seplat’s strategy, governance, and asset quality.
Beyond the immediate sentiment boost, Seplat’s underlying fundamentals suggest the rally may be more than a short-lived reaction. Between 2020 and 2024, the company generated cumulative revenues of about N3.2 trillion, culminating in a record N1.65 trillion in 2024, achieved even before the full consolidation of Mobil Producing Nigeria Unlimited’s offshore assets. That growth trajectory accelerated sharply in 2025. In the first nine months of the year alone, Seplat reported revenue of N3.36 trillion, a 213% year-on-year increase that exceeded the combined revenue of the previous five years.
Operating profitability expanded at a similar pace. Profit before tax surged to N879 billion, up from N367 billion in the corresponding period of 2024. Net profit, however, told a more complex story. Post-tax earnings declined to N147 billion as tax obligations absorbed a substantial share of operating gains. Total tax charges reached N732 billion, including N704 billion in current tax expenses, creating a wide gap between pre-tax and after-tax performance.
Even so, shareholder returns remained compelling. Earnings per share rose by 144% to N240.18, while dividends declared by the third quarter of 2025 amounted to 167 cents per share, translating to roughly N157 billion in total distributions. Within the Nigerian energy sector, this positions Seplat as one of the more reliable dividend-paying stocks.
Operationally, the revenue surge was driven primarily by higher oil volumes. Crude oil sales climbed to N3.1 trillion, reflecting a 231% increase year-on-year. This was largely due to the integration of MPNU’s offshore assets, which added more than 80,000 barrels of oil equivalent per day. Seplat’s well-restoration programme further contributed about 33,400 barrels per day. Despite a 13% decline in realised oil prices, total lifted volumes rose to 27.9 million barrels, a 270% year-on-year increase.
Gas operations provided an additional layer of stability. Gas revenue grew to N215 billion, supported by steady production from Oben and Sapele, alongside initial LPG sales from the Bonny terminal. The introduction of natural gas liquids as a separate revenue stream generated N51 billion from LPG exports and condensates, improving both diversification and margin resilience.
Looking ahead, Seplat’s medium-term strategy remains ambitious. At its Capital Markets Day in September 2025, management outlined plans to scale production to 200,000 barrels of oil equivalent per day by 2030, backed by capital expenditure of $2.5–$3 billion. The company is targeting $5–$6 billion in free cash flow over the same period, while cutting operating costs to $10 per barrel from $14.10.
Capital allocation is central to this outlook. Seplat revised its dividend policy in 2025 to allow up to two special dividends annually in addition to a base payout, with a target of $1 billion in cumulative dividends by 2030. These projections are built on conservative assumptions, including oil prices of $65 per barrel and disciplined leverage management.
As Seplat continues its transition from a mid-sized onshore producer to a diversified upstream and gas company with offshore scale, the Heirs Energies deal has sharpened investor focus on its long-term potential. Sustaining the current valuation will depend on disciplined execution, but if management delivers on its stated goals, the early-2026 rally may well reflect a structurally stronger company rather than short-term market enthusiasm.
Emmanuel Bassey is a Financial Expert that has worked in the Banking and Finance Industry for over 15+ years across different banks in Nigeria
