Six Oil & Gas Companies’ Revenue Up 57% to N6.69trn on PMS Price Hike

Kayode Tokede 

Following the Federal Government reforms in  the Oil && Gas sector, Oando Plc, and five other OIl & gas companies generated an estimated N6.69 trillion revenue in 2024, about 57 per cent increase when compared to N4.27 trillion in 2023.

The remaining five oil & gas companies are: Totalenergies Marketing Nigeria Plc, MRS Oil Nigeria Plc, Aradel Holdings Plc, Eterna Plc and Conoil Plc.

Analysis of their unaudited result and accounts for the period ended December 31, 2024, showed that the six companies declared N440.09 billion profit before tax in 2024, a significant increase of 84 per cent from N239.01 billion in 2023.

The companies’ revenue grew significantly to reflect price adjustment in Premium Motor Spirit (PMS), stable global oil prices, among other factors.  

These companies benefited from FG’s reforms in recent years and it has attracted investment in the oil and gas sector.

The reforms were aimed at enhancing operational efficiencies, increasing local participation, and encouraging a shift toward cleaner energy practices.

Part of the reforms include: Petroleum Industry Act (PIA), deregulation of the downstream sector, gas infrastructure development and promotion, ease of doing business initiatives, among others. 

Further analysis showed that Oando recorded N4.12 trillion revenue, about 45 per cent increase over N2.85 trillion reported in 2023, while Totalenergies Marketing Nigeria declared N1.04 trillion revenue in 2024, representing an increase of 63.8 per cent from N635.95 billion reported in 2023. 

The management of Oando in a statement said its revenue growth was driven by higher crude oil volumes lifted, and higher  gas prices as well as the positive impact of exchange rate translations, offset by lower trading  volumes, reduced natural gas and NGL volumes, and lower realized sale prices for crude oil and NGL.

Speaking on the results, Group Chief Executive, Oando, Wale Tinubu, said, “2024 was a year of transformation for Oando, the key highlight being our successful acquisition and subsequent integration of NAOC Ltd, which significantly enhanced our production capacity, attaining peak operated production of 103,206boepd and net entitlements of 45,000 boepd.

“Despite a challenging operating environment, we achieved a 45% increase in revenue to N4.1 trillion, reflecting the strength of our business model, and nine per cent rise in profit after tax to N65.5 billion, notwithstanding the costs associated with the onboarding of NAOC.”

Aradel Holdings, a newly listed oil & gas company on NGX posted N581.02 billion revenue in the year under review, up by 163 per cent from N221.14 billion declared in the corresponding period of 2023. 

For Aradel Holdings, the management said the significant increase in revenue was primarily  due  to: “244.6per cent increase in export crude oil revenue (64.31per cent of total revenue) to N373.7 billion (2023 N108.4 billion;  49.03per cent of total), attributed to increased production levels, significant impact of improved utilisation of the Trans Niger Pipeline (TNP) on which there has been reduced crude losses, and additional value from the  Alternative Crude Evacuation (ACE) route with resultant higher crude oil lifting of 3.1 mbbls in 2024 (FY 2023: 2.1 mbbls).

The Chief Executive Officer, Aradel Holdings, Mr. Adegbite Falade said, “The Company sustained its strong operational and financial performance in 2024, building on the improvements achieved in 2023.

“We recorded increased topline and bottomline, driven by significantly higher hydrocarbon production, the successful re-entry of Well 2ST in the Omerelu Field, which resulted in the attainment of First Oil on 31st May 2024 and increased sales volumes from our refinery operations. We successfully drilled Wells 14 and 15, marking the conclusion of our Phase 1, four-well turnkey drilling campaign with favourable results.

“We kicked off the second phase of the drilling campaign with Well 16, which is approaching completion. To support the anticipated production growth, we expanded the throughput capacity of our evacuation channels, positioning us to maintain strong output and efficiency levels throughout the year.

“We completed the acquisition of the Olo and Olo West Marginal Fields from the TotalEnergies/NNPC Joint venture, and entered an agreement to acquire a minority equity interest in Chappal Energies Mauritius Limited – an energy company focusing on investments in deep value and brownfield upstream opportunities within Africa.”

He added, “Aradel is also an equity participant in the Renaissance Africa Energy Company Limited, the acquirer of Shell’s 100 per cent equity interest in the Shell Petroleum Development Company (SPDC) Limited, for which Ministerial Consent has been obtained. These acquisitions further enhance our portfolio and create new opportunities for future production growth.

“They will complement our existing operations and provide significant long-term value, aligning with our broader strategy of expanding our asset base to multiple assets across different locations, and increasing the resilience as well as sustainability of our business.”

Amid hike in price of PMS, among others, Conoil announced N323.13 billion revenue in 2024, about 60.5 per cent increase over N201.39 billion in 2023. 

Furthermore, Eterna delivered N313.6 billion revenue in 2024, a growth of 71 per cent from N183.3 billion in 2023, while MRS Oil Nigeria Plc reported N312.23 billion revenue in 2024, uup by 71.3per cent from N182.3 billion in 2023. 

The growth in revenue is coming at a time when the price of PMS, among other products, have increased significantly.

According to the National Bureau of Statistics (NBS), the average retail price paid by consumers for Petrol for December 2024 was N1189.12, indicating a 76.99per cent increase compared to the value recorded in December 2023 (N671.86).

NBS stated that in December 2024, the average price for refilling a 5kg cylinder of Liquefied Petroleum Gas (Cooking Gas) in Nigeria was N7,177.27, which was a 44.62per cent increase from N4,962.87 in December 2023.

“For a 12.5kg cylinder, the average price in December 2024 was N17,274.16, which was a 50.08per cent increase from N11,510.16 in December 2023,”  NBS added. 

Analysts have attributed the hike in these companies’ revenue to the federal government’s reforms in the oil & gas sector, urging investors to take positions in companies with fundamentals.

The Chief Operating Officer of InvestData Consulting Limited, Mr Ambrose Omordion, attributed the increase in revenue of these companies to higher-margin crude oil products, stressing that the ease of movement also contributed to revenue and profit.

According to him, “These companies reported an increase in revenue due to higher margin in products they sold this year. The reforms in the oil & gas sector have impacted on revenue that translates into profit.”

The Vice President, Highcap Securities Limited, Mr. David Adnori, told THISDAY that the growth in the period under review was driven by increase in petroleum price, stressing that increasing business activities, also a driving factor

According to him, “The crude oil price per barrel in the global commodity market was low in 2020 and it affected the price of petrol. The federal government was reliant on increasing the price of petrol at some time. The growth recorded in revenue by these companies has a lot to do with improvement in business activities than the hike in price of petroleum products.”