Seplat Energy Plc has begun 2026 on a strong footing, with its shares gaining 6.2 percent year to date in the first trading week of the year, following the acquisition of a significant minority stake by Heirs Energies and renewed investor confidence in the company’s growth outlook.
The early momentum contrasts with the company’s more measured performance in 2025. After a year of strong capital appreciation in 2024, Seplat closed 2025 with a modest share price gain of 1.94 percent. That performance appeared subdued against the backdrop of a Nigerian Exchange All-Share Index rally of more than 50 percent over the same period.
A closer look, however, presents a more nuanced picture. While the broader equity market surged in 2025, the Oil and Gas Sector Index declined by 1.54 percent, reflecting sector-specific pressures. Within that context, Seplat outperformed most of its immediate peers, posting positive returns in a challenging operating and market environment.
That relative resilience transitioned into renewed momentum at the start of 2026. Within days of the market reopening, Seplat’s shares climbed to a new 52-week high of N6,171, surpassing the company’s total return for the whole of 2025 in a single week.
The rally was triggered by the announcement that Heirs Energies had acquired Maurel & Prom S.A.’s entire 20.07 percent stake in Seplat. The transaction involved 120.4 million shares and was valued at approximately $500 million, at a price of £3.05 per share. Executed under the leadership of Heirs Energies Chairman Tony Elumelu, the deal marked a significant shift in Seplat’s shareholder structure.
Market reaction suggested that investors viewed the acquisition as more than a routine transfer of shares. The entry of Heirs Energies was interpreted as a long-term endorsement of Seplat’s strategy, asset base, and growth prospects, prompting a rapid repricing of the stock.
Attention has now shifted to whether the early-year rally can be sustained by fundamentals rather than sentiment. On that front, Seplat’s recent financial and operational performance provides a strong underpinning.
Between 2020 and 2024, the company generated cumulative revenues of N3.2 trillion, culminating in a record N1.65 trillion in 2024, prior to the consolidation of Mobil Producing Nigeria Unlimited’s offshore assets. That growth trajectory accelerated sharply in 2025. In the first nine months of the year, Seplat reported revenue of N3.36 trillion, representing a 213 percent increase year on year and exceeding the combined revenue of the preceding five years.
Operating profitability expanded at a similar pace. Profit before tax rose to N879 billion, compared with N367 billion in the corresponding period of 2024. Net profit, however, declined to N147 billion, reflecting the impact of significantly higher tax liabilities. Total tax charges amounted to N732 billion, including N704 billion in current tax expenses, creating a wide gap between pre-tax and post-tax earnings.
Despite the pressure from taxes, shareholder returns remained robust. Earnings per share rose by 144 percent to N240.18, while dividends declared by the third quarter of 2025 totalled 167 cents per share, equivalent to about N157 billion. This places Seplat among the more consistent dividend-paying companies on the Nigerian Exchange, particularly within the energy sector.
Operational performance was driven largely by higher oil volumes. Crude oil revenue reached N3.1 trillion, up 231 percent year on year, reflecting the integration of MPNU’s offshore assets, which added more than 80,000 barrels of oil equivalent per day to production. Seplat’s well restoration programme contributed an additional 33,400 barrels per day.
Even as realised oil prices declined by 13 percent, total lifted volumes rose to 27.9 million barrels, representing a 270 percent increase year on year. This volume-led growth helped offset price pressures and supported topline expansion.
Gas operations provided stability and incremental growth. Gas revenue increased to N215 billion, supported by steady production from the Oben and Sapele gas plants, as well as initial liquefied petroleum gas sales from the Bonny terminal. The introduction of natural gas liquids as a separate revenue line generated N51 billion from LPG exports and condensates, improving diversification and margin resilience.
Looking ahead, Seplat has articulated a clear medium-term growth strategy. At its Capital Markets Day in September 2025, management outlined plans to increase production to 200,000 barrels of oil equivalent per day by 2030, supported by capital expenditure of between $2.5 billion and $3 billion.
The company is targeting $5 billion to $6 billion in free cash flow over the period, alongside a reduction in operating costs to $10 per barrel from $14.10. Capital allocation remains central to this strategy. In 2025, Seplat revised its dividend policy to allow for up to two special dividends annually in addition to a base dividend, with a target of $1 billion in cumulative dividends by 2030.
These projections are based on conservative assumptions, including oil prices of $65 per barrel, natural gas liquids prices of $39 per barrel, and gas prices of $2.75 per thousand cubic feet.
Seplat’s transformation from a mid-sized onshore producer into a diversified upstream and gas company with offshore scale is becoming increasingly evident. The Heirs Energies transaction has reinforced that trajectory and sharpened investor focus on the company’s long-term fundamentals.
Sustaining the current valuation, however, will depend on disciplined execution. Managing costs, taxes, and capital commitments while delivering production growth will be critical. If Seplat succeeds, the recent rally may prove to be less a speculative reaction and more a reflection of a structurally stronger company.