Nigerian energy company Seplat Energy is set to invest up to $320 million this year in drilling new wells and upgrading infrastructure as part of its strategy to boost oil production. Following its acquisition of Exxon Mobil's Nigerian assets, the company aims to more than double its output to as much as 140,000 barrels per day.

The acquisition, which includes a 40% stake in oil mining leases and a 51% stake in a natural gas liquids recovery plant, is expected to play a significant role in Seplat Energy's production expansion. The deal is anticipated to increase the company's onshore and shallow water oil output from an average of 48,618 barrels per day (bpd) last year to as much as 140,000 bpd.

Financially, the company reported a profit before tax of $379.4 million, marking a sharp increase from $191 million the previous year. Revenue grew by 5% year-over-year to $1.116 billion, while year-end cash at the bank stood at $469.9 million. However, Seplat closed 2024 with a net debt of $898 million, reflecting its ongoing investments and expansion efforts.

The company's investment plans come at a time when international oil companies have significantly reduced their onshore and shallow-water oil production in Nigeria due to persistent issues, including sabotage, oil theft, and disputes with local communities over environmental concerns and leaks. This trend has led to increased operational risks and financial losses, prompting some firms to divest from these assets.

In response, Seplat Energy plans to reactivate hundreds of dormant oil wells and drill 13 new onshore wells this year as part of its strategy to enhance production. Additionally, the company is set to complete the ANOH gas plant, a major project aimed at increasing domestic gas supply and supporting Nigeria's energy transition efforts.

The investment is expected to have a significant impact on Nigeria's energy sector, which has been grappling with issues of oil theft and sabotage. Seplat Energy's expansion plans are seen as a positive development for the country's oil industry, which has been experiencing a decline in recent years.

As the company continues to invest in its operations, it remains to be seen how its expansion plans will affect the Nigerian energy landscape. However, with its ambitious targets and significant investment, Seplat Energy is poised to play a major role in shaping the country's energy future.

In a broader context, Seplat Energy's investment plans highlight the importance of energy transition efforts in Africa. As the continent continues to grapple with energy security and sustainability challenges, investments in oil and gas production are critical to meeting growing energy demands. However, it is equally important to prioritize environmental concerns and ensure that energy production is carried out in a responsible and sustainable manner.