Oando Plc reduced its borrowings to N2.16 trillion, 22 percent below the peak at the end of 2024. The Nigerian energy company said stronger cash flows and higher oil and gas output are helping it fund an expansion of its drilling program.

The company, which is listed in Lagos and Johannesburg, reported that cash generated from operations reached N285 billion in the nine months through September. It spent N110.7 billion on capital expenditure, mostly on drilling across oil mining leases 60 to 63.

The results mark a turnaround from a year earlier. Oando posted an operating profit of N159.7 billion, compared with an operating loss of N109.7 billion in the same period of 2025. Revenue rose 9 percent to N2.78 trillion, helped by higher crude liftings, larger gas and natural gas liquids sales and better realised prices. Gross profit jumped 483 percent to N174.5 billion from N29.8 billion.

Read also: Oando returns to operating profit with N159.7bn in nine months

Production is behind much of the improvement. Output averaged 42,985 barrels of oil equivalent a day, up 14 percent from 37,614. Crude rose 12 percent to 12,193 barrels a day, gas gained 13 percent to 28,689 boepd, and natural gas liquids climbed 53 percent to 2,103 barrels a day.

Sales volumes grew faster than output. Crude oil liftings rose 43 percent to 3.97 million barrels, gas sales increased 5 percent to 34.01 billion standard cubic feet, and NGL sales almost doubled, up 90 percent to 0.57 million barrels. Total exploration and production sales volumes were up 21 percent at 10.21 million barrels of oil equivalent.

Oando also cut costs. Production operating costs fell 22 percent to $15.39 a barrel, which the company attributed to savings on transport, logistics, services and information technology, and to spreading largely fixed field costs over more barrels. Facility uptime improved to 96.1 percent from 85 percent.

“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,” Wale Tinubu, group chief executive said. He added that the company recorded no fatalities or lost-time injuries across about 14.9 million hours worked.

Drilling Program

Oando’s seven-well drilling program for 2026 is moving forward. Wells Idu 6ST and Idu 15 are on stream, and workovers at Samabri 4T and Samabri 7T are complete. Drilling continues at Idu T and Samabri A50, and the final well, Ogbainbiri, is due to spud in December.

Once finished, the campaign is expected to add roughly 16,000 to 20,000 boepd of gross production. That would offset natural decline at its operated fields and support a medium-term goal of about 100,000 boepd within four to five years.

For the full year, Oando narrowed its production guidance to 40,000 to 45,000 boepd. It expects capital spending of $90 million to $100 million, focused on short-cycle upstream projects.

Equity Raise

The company said it plans an equity raise to strengthen shareholders’ funds.

 “These initiatives are intended to reduce leverage, enhance our capacity to fund growth and support future shareholder distributions,” Tinubu said. He did not give a size or timetable for the offering.

Even after the reduction, Oando’s borrowings remain large against its operating profit, which explains the emphasis on leverage.

Clean Energy

Outside oil and gas, Oando’s electric bus partnership with the Lagos Metropolitan Area Transport Authority recorded more than 212,000 passenger journeys in the nine months, with average capacity utilisation of 73 percent. Eleven more buses, the first batch of a planned 50, have arrived in Lagos, bringing the fleet to 13. The larger fleet is expected to enter service in the fourth quarter, with the transport authority operating the buses for Lagos State.