Oil and gas giant OandoPlc posted its 2014 FY results alongside its Q1 2015 results, racking up record after-tax losses of N183.9 billion in FYE 2014, which created a wild hysteria on Twitter and Facebook. Click here to read our previous report on this.
The company is now explaining the reason behind the loss, a statement from Oando says that “the loss is as a result of the 50% reduction of crude oil prices. Put simply a restatement of the current value of our ourpre Conocophilips acquisition Oil reserves portfolio reduced the value by 71% – N130bn, we have reduced the value of our Rigs by N36bn to reflect the reduction in chargeable day rates and reduction in utilization. We have had N7.3bn in exchange rate loses. Total N183bn. Unfortunately under the new IFRS accounting standard it had to be charged to your profit and loss account for the current accounting period. Our markets are not sophisticated to understand that this is a non cash loss. OANDO will be governed by the integrity of its Finacial statements. We borrow and trade abroad and all the foreign oil companies are doing the same. We will do the right thing no matter what. In due course others will follow.”
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