Seplat Energy aims to return a cumulative $1 billion in dividends to shareholders by 2030. This is as the group is unveiling a new payout strategy that ties investor rewards directly to rising production and free cash flow.
At its Capital Markets Day on September 18, the indigenous energy group announced a revised dividend policy. The policy commits to distributing between 40 percent and 50 percent of free cash flow over the 2026–2030 cycle. Based on its base-case forecast, this equates to a $1 billion payout over five years.
A key feature of the new policy is a floor: Seplat will return at least $120 million annually, equivalent to $0.20 per share annually or $0.05 per quarter. This is based on the provision that Brent crude averages above $50 per barrel.
To signal this commitment, the company notes it will increase its Q3 2025 dividend by about 10 percent to 5.0 cents per share.
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The stronger payout outlook is underpinned by a significant boost in reserves following Seplat’s acquisition of offshore assets last year. An independent Competent Person’s Report commissioned from Ryder Scott Company showed that the offshore portfolio alone has seen 2P reserves rise 40 percent to 552 million barrels of oil equivalent (boe).
This is as the offshore 2C reserves surged nearly fourfold to 1.18 billion boe. For the group, 2P reserves climbed 18 percent to 1.04 billion boe, and combined 2P+2C reserves nearly doubled to 2.3 billion boe.
Roger Brown, the chief executive officer of Seplat, said the upgrade validates Seplat’s acquisition strategy and underscores the scale of opportunities ahead. “Since our IPO in 2014, we have delivered growth of approximately four times reserves and operated production while returning over $700 million in dividends.
“Today we set out our roadmap to 2030, our vision for the medium term which will see us materially grow production and cash flow to drive significantly enhanced shareholder returns,” he said.
Beyond reserves growth, Seplat disclosed ongoing talks with the NNPCL on a potential sell-down of a 10 percent interest in their offshore joint venture. If concluded, the transaction would leave Seplat with 30 percent and NNPC with 70 percent. The group emphasised that any such restructuring would not affect its dividend commitments.
Since debuting on the Nigerian Exchange in 2014, Seplat Energy has built a reputation for consistent shareholder rewards. The group paid out an estimated $575 million in dividends between 2014 and 2023. It has also maintained one of the most reliable payout histories on the market, distributing dividends in nine of the past ten years, even in periods of oil price volatility.
In 2023, Seplat raised its dividend to 12 cents per share, a combination of base and special distributions, bringing the total payout for the year to about $72 million. That momentum carried into 2024, when the company paid a total dividend of 16.5 cents per share for the financial year, translating to about $98.9 million.
Beyond the headline numbers, Seplat’s dividend strategy stands out for its frequency. It is the only company on the Nigerian Exchange that distributes dividends every quarter. This is a rare approach in a market where payouts are often semi-annual, annual, or even inconsistent in some cases.