Operating costs drop 22% as facility uptime hits 96.1%
Records N159.7bn operating profit as gross profit surges 483%
Wale Tinubu: performance demonstrates how diligent execution under our operatorship is delivering greater efficiency, improved reliability, others
James Emejo in Abuja
Oando Plc grew its revenue by nine per cent to ₦2.78 trillion in the first nine months of 2026, as higher crude oil liftings, increased gas and natural gas liquids (NGL) sales and improved realised prices boosted earnings.
Stronger operational efficiency also helped restore the group to operating profitability.
The indigenous energy company, in its unaudited results for the nine months ended September 30, 2026, reported an average daily production of 42,985 barrels of oil equivalent per day (boepd), up 14 per cent from 37,614 boepd in the corresponding period of 2025.
Its operating performance recorded a significant turnaround, with operating profit reaching ₦159.7 billion, compared with an operating loss of ₦109.7 billion a year earlier.
Gross profit also rose sharply by 483 per cent to ₦174.5 billion from ₦29.8 billion, reflecting higher production volumes, improved facility reliability and lower operating costs.
The results point to a stronger earnings position for the group as it expands output from its upstream assets and pursues a drilling programme intended to raise production capacity over the medium term.
Higher crude liftings, gas sales drive revenue
Oando’s production growth was supported by improved output across its crude oil, gas and NGL operations.
Crude oil production increased 12 per cent to 12,193 barrels per day, while gas production rose 13 per cent to 28,689 boepd.
NGL production recorded the strongest growth, climbing 53 per cent to 2,103 barrels per day.
The increase in output translated into higher sales volumes across the group’s exploration and production portfolio.
Crude oil liftings rose 43 per cent to 3.97 million barrels, while natural gas sales grew five per cent to 34.01 billion standard cubic feet. NGL sales surged 90 per cent to 570,000 barrels.
Combined exploration and production sales volumes increased 21 per cent to 10.21 million barrels of oil equivalent.
Commenting on the performance, Group Chief Executive, Wale Tinubu, said the results reflected improved execution under the group’s operatorship, supported by renewed investment across its expanded upstream portfolio.
He said average production rose 14 per cent year-on-year, while facility uptime improved to 96.1 per cent from 85 per cent in the corresponding period of 2025.
He said, “He said, “Our performance in the first nine months of 2026 demonstrates how diligent execution under our operatorship, supported by our renewed investment drive, is delivering greater efficiency, improved reliability, lower unit costs and ultimately higher production across our expanded upstream portfolio.
“Production averaged 42,985 boepd, up 14% year-on-year, while facility uptime improved to 96.1 per cent and production operating costs declined by 22 per to $15.39 per boe. These gains were achieved with zero fatalities and zero lost-time injuries across approximately 14.9 million hours worked.”
The improvement in operational reliability, alongside increased output, helped reduce production operating costs by 22 per cent to $15.39 per barrel of oil equivalent.
The lower cost base was attributed to optimisation across transportation, logistics, services and information and communications technology, as well as higher production spread across a largely fixed field cost base.
Oando also reported zero fatalities and zero lost-time injuries over approximately 14.9 million hours worked during the period, representing a 55 per cent increase in total hours worked compared with the same period last year.
Drilling programme targets higher output
Accorsing to the report, the company committed ₦110.7 billion to capital expenditure during the nine-month period, with the bulk directed towards drilling activities across Oil Mining Leases (OMLs) 60–63.
Its seven-well development programme for 2026 has recorded progress, with Idu 6ST and Idu 15 completed and brought on stream. Workovers at Samabri 4T and Samabri 7T have also been completed.
Drilling is continuing at Idu T and Samabri A50, while the final well in the programme, Ogbainbiri, is scheduled to commence drilling in December.
The campaign is expected to contribute an additional 16,000 to 20,000 boepd on a gross basis when completed, helping to sustain production and offset natural declines from existing fields.
The expansion is also expected to support Oando’s medium-term ambition of producing approximately 100,000 boepd within the next four to five years.
For the remainder of 2026, the company has narrowed its full-year production guidance to between 40,000 and 45,000 boepd. It expects capital expenditure for the year to range from $90 million to $100 million, primarily focused on upstream projects with shorter development cycles.
Tinubu said the group’s priorities for the final quarter included completing the drilling programme, maintaining operational reliability and strengthening shareholders’ funds through a planned equity raise.
The proposed capital raising, he said, was intended to reduce leverage, improve the company’s capacity to finance growth and support future shareholder distributions.
Borrowings fall as operating cash flow strengthens
Oando’s operating improvements were accompanied by a reduction in its debt position and stronger cash generation.
Total borrowings declined to ₦2.16 trillion, 22 per cent below the peak recorded at the end of 2024, while cash generated from operations reached ₦285 billion.
The combination of lower production costs, increased sales volumes and improved cash generation could provide additional support for the company’s investment programme, although the planned equity raise remains a key component of its capital management strategy.
The group is entering the final quarter focused on sustaining production gains while completing its development activities and strengthening its balance sheet.
However, the oil firm is also expanding its presence in electric mobility through its partnership with the Lagos Metropolitan Area Transport Authority (LAMATA).
The electric buses deployed under the partnership recorded more than 212,000 passenger journeys in the first nine months of 2026, with average capacity utilisation of 73 per cent.
An additional 11 electric buses, representing the first batch of a planned 50, arrived in Lagos during the period, bringing the fleet to 13. The expanded fleet is expected to enter service in the fourth quarter, with LAMATA operating the buses on behalf of the Lagos State Government.
Tinubu said the company remained focused on realising the potential of its upstream resource base while strengthening its financial position and creating long-term value for shareholders.
According to him, “For the remainder of 2026, our priorities are to progress the seven-well development programme, sustain operational reliability and strengthen shareholders’ funds through our impending equity raise.
“These initiatives are intended to reduce leverage, enhance our capacity to fund growth and support future shareholder distributions. We have demonstrated what we can achieve across our strategic assets and are confident in the opportunities ahead.
“Our commitment remains to realise the full potential of our substantial resource base and deliver lasting value for our shareholders.”
