Q3 Financial Results SENS Announcement

Oando Plc

(Incorporated in Nigeria and registered as an external company in South Africa)

Registration number: RC 6474

(External company registration number: 2005/038824/10

Share Code on the JSE Limited: OAO

Share Code on the Nigerian Stock Exchange: UNTP

ISIN: NGOANDO00002

(“Oando” or “the Company” or “the Group”)

Unaudited results for the third quarter ended 30 September, 2010

Highlights

Review of results

Oando, primary listed on the Nigerian Stock Exchange (“NSE”) and secondary listed on JSE Limited (“JSE”), reports profit after tax (“PAT”) for the period ended 30 September 2010 of US59.09 million.

Income statement analysis

Revenue increased by 8% compared to the same period in 2009. The Group recorded a 29% increase in profit after tax in comparison with the same period in 2009. The performance was mainly due to the following:

Expenses review

Marketing and selling expenses increased by 18% compared to the same period in 2009. This was driven by the increase in sales at inland locations during the period in comparison with the same period in 2009. This has attracted increased dealers’ commission. Administrative expenses increased by 53% due to the operational costs, depreciation of the drilling rigs and the independent power producer (“IPP”) project. During 2009 only one drilling rig was in operation and operation commenced in August 2009.

Finance costs increased by 86% compared to the same period in 2009, as a result of recognition of finance costs on the drilling rigs and IPP assets in the income statement in 2010. Similar costs incurred in the pre operational phase of the assets and were capitalised.

Balance sheet analysis

Property, plant and equipment increased by 32% as a result of the acquisition of Equator Exploration Limited, which was concluded in the fourth quarter of 2009. Long term receivables rose by 41% compared to the same period in 2009, driven by the additional capital expenditure on the East Horizon Gas Company Limited (“EHGC”) pipeline project.

Inventory rose by 9% compared to the same period in 2009 due to the additional maintenance stocks held to cater for the requirements of the new businesses.

Trade and other debtors reduced by 20% driven by the positive impact of various initiatives aimed at improving trade accounts receivables management.

Future prospects

The investments hitherto made in the upstream assets, drilling rigs and IPP assets have started yielding returns.

We have commenced activities towards drilling additional wells in the producing assets, Oil Mining Licence (“OML”) 125 and OML 56). We expect these activities to raise the Group’s crude oil production per day and therefore boost revenue and profitability contribution of the upstream business.

The commissioned LSWC IPP has been experiencing steady operations with positive impacts on the Group’s revenue and profit contribution. The ongoing construction work at EHGC’s 128km pipeline project has also progressed during the period. Commissioning of the pipeline is expected in the first quarter of 2011.

Government’s introduction of Sovereign Notes as guarantees for PSF receivables has improved petroleum products supply as well as reduced working capital requirements for the downstream businesses. These measures resulted in improved contribution to the Group’s performance. We anticipate that these trends to may continue.

Our Energy Services Division has deployed another drilling rig into operation, while refurbishment and contracting for a third drilling rig is being finalised.

The current performance reflects the robustness of the Company’s strategy and it is anticipated that the current trend may continue for the rest of the year.

Consolidated Statement of financial position as at 30 September, 2010

Consolidated statement of comprehensive Income For the period ended 30 September 2010

The Group is organised into six main business divisions:

Consolidated Statement of changes in Shareholder’s Equity Attributable to equity holders of the Company for the period ended 30 September 2010

Consolidated Statement of changes in Shareholder’s Equity Attributable to equity holders of the Company for the period ended 30 September 2009 (continued)

Notes to results

1. General information

Oando (formerly Unipetrol Nigeria Plc) was registered by a special resolution as a result of the acquisition of the shareholding of Esso Africa Incorporated (principal shareholder of Esso Standard Nigeria Limited) by the Federal Government of Nigeria. The Company was partially privatised in 1991. It was however fully privatised in the year 2000 subsequent to the sale of the Federal Government’s 40% shareholding in the Company. Of the Government’s holding, 30% was sold to core investors (Ocean and Oil Investments Limited) and the remaining 10% to the Nigerian public. In December 2002, the Company merged with Agip Nigeria Plc following its acquisition of 60% of Agip Petroli’s stake in Agip Nigeria Plc in August of the same year. The Company formally changed its name from Unipetrol Nigeria Plc to Oando Plc in December 2003.

The principal activity of the Company both locally and internationally is strategic investments in energy companies across West Africa. The Group is involved in the following business activities via its subsidiary companies:

2. Summary of significant accounting policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of preparation

The consolidated financial statements of Oando have been prepared in accordance with International Financial Reporting Standards (“IFRS”). The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of land and buildings, and financial assets and financial liabilities at fair value through profit or loss.

The preparation of financial statements in accordance with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise judgement in the process of applying the Group’s accounting policies.

Early adoption of standards

In 2004, the Group early adopted the IFRS below, which are relevant to its operations. These have been consistently applied in this unaudited financial report for the six months period ended 30 September 2010.

IAS 2 (revised 2003) Inventories
IAS 8 (revised 2003) Accounting Policies, Changes in Accounting Estimates and Errors

IAS 10 (revised 2003) Events after the Balance Sheet Date

IAS 16 (revised 2003) Property, Plant and Equipment

IAS 17 (revised 2003) Leases

IAS 21 (revised 2003) The Effects of Changes in Foreign Exchange Rates

IAS 24 (revised 2003) Related Party Disclosures

IAS 27 (revised 2003) Consolidated and Separate Financial Statements

IAS 28 (revised 2003) Investments in Associates

IAS 32 (revised 2003) Financial Instruments: Disclosure and Presentation

IAS 33 (revised 2003) Earnings per share

IAS 36 (revised 2004) Impairment of Assets

IAS 38 (revised 2004) Intangible Assets

IAS 39 (revised 2003) financial instruments: Recognition and measurement

IFRS 2 (issued 2004) Share-based payments

IFRS 3 (issued 2004) Business Combinations

IFRS 5 (issued 2004) Non-current Assets Held for Sale and Discontinued
IFRIC 10 (Issued 2006) Interim Financial Reporting and Impairment.

All changes in the accounting policies have been made in accordance with the transition provisions in the respective standards.

The early adoption of IAS 1, 2, 8, 17 28, and 32 (all revised 2003) did not result in substantial changes to the Group’s accounting policies.

In summary:

– IAS 1, 2, 28 and 32 had no material effect on the Group’s policies.

– IAS 8 (revised 2004) has resulted in the disclosure of the impact of new standards

2.2 Consolidation

(a) Subsidiaries

Subsidiaries include all entities (including special purpose entities) over which the Group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group. The cost of the acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed and the date of plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at fair values at the acquisition date irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the income statement. All balances and unrealised surpluses and deficits on transactions between Group companies have been eliminated. Where necessary, accounting policies for subsidiaries have been changed to be consistent with the policies adopted by the Company, Separate disclosure (in equity) is made of minority interests.

(b) Associates

Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for by the equity method of accounting and are initially recognised at cost. The Group’s investment in associates includes goodwill (net of any accumulated impairment loss) identified on acquisition. The Group’s share of its associates’ post-acquisition profits or losses is recognised in the income statement, and its share of post acquisition movements in reserves is recognised in reserves. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment.

When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate. Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. The accounting policies of the associates are consistent with the policies adopted by the Group.

Goodwill included in the carrying amount of an investment is neither amortised nor tested for impairment separately by applying the requirements for impairment testing goodwill in IAS 36, Impairment of Assets. Instead, the entire carrying amount of the investment is tested under IAS 36 for impairment.

All subsidiaries and associates have uniform calendar year ends.

2.3 Segment reporting

A business segment is a group of assets and operations engaged in providing products or services that are subject to risks and returns that are different from those of other business segments. A geographical segment is engaged in providing products or services within a particular economic environment that are subject to risks and return that are different from those of segments operating in other economic environments.

2.4 Foreign currency translation

(a) Functional and presentation currency

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). The functional currency of the Group is the Naira. The consolidated financial statements are presented in US dollars, which is the Company’s presentation currency for the purpose of filing outside Nigeria.

(b) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement, except when deferred in equity as qualifying cash flow hedges and qualifying net investment hedges.

(c) Group companies

The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

3. Earnings Per Share

Basic Earnings per share (“EPS”) is calculated by dividing the profit attributable to the equity holders of the Company by the weighted average number of shares in issue during the period.

4. Independent audit by the auditors

This condensed consolidated result have neither been audited nor reviewed by the Company’s auditors

5. Post balance sheet events

There are no significant post balance sheet events that in the opinion of the directors will have a material impact on the accounts herein presented.

For and on behalf of the Board

Mr J Adewale Tinubu

Group Chief Executive

12 November 2010

Directorate:

Company Secretary: Mrs. Oredeji Delano

Registered office: 2, Ajose Adeogun Street, Victoria Island, Lagos, Nigeria

Auditors: PriceWaterhouseCoopers, Plot 252E Muri Okunola Street, Victoria Island, Lagos

E-mail: info@oandoplc.com

Registered office in South Africa: 1st Floor, 32 Fricker Road, Illovo Boulevard, Sandton, 2196, South Africa

Office of the South African registrars: Computershare Investor Services (Proprietary) Limited (Registration number: 2004/003647/07)

70 Marshall Street, Johannesburg, 2001. PO Box 61051, Marshalltown, 2107

12 November 2010

Sandton, Johannesburg

JSE Sponsor

Macquarie First South Advisers (Proprietary) Limited