VAALCO Energy, Inc. (NYSE: EGY) (“VAALCO” or the “Company”) today
provided an operational update with additional details on the
commencement of its 2019/2020 drilling program, the successful
completion of its full-field annual maintenance shutdown at Etame,
and the extension of the lease contract for the floating,
production, storage and offloading vessel (“FPSO”) Petróleo Nautipa
offshore Gabon.
Key Highlights
- Delivery of the Vantage Drilling International Topaz jackup
drilling rig to VAALCO is expected in early September
- Announced plans to drill the Etame 9P appraisal wellbore first,
followed by the Etame 9H development well from the Etame
platform
- Confirmed plans to drill an additional appraisal wellbore and
up to two more development wellbores later this year and into the
first half of next year
- Successfully resumed full production following completion of
the planned full-field annual maintenance shutdown offshore Gabon
at the Etame field in August on schedule and on budget
- Exercised an election to extend the lease contract for the FPSO
to September 2021 with an additional one-year option through
September 2022
Cary Bounds, Chief Executive Officer, commented,
“We are very pleased to have the Vantage Topaz jackup rig
mobilizing to the Etame platform to commence our 2019/2020 drilling
campaign in mid-September. This represents the commencement
of a busy and exciting period of operational activity for VAALCO,
the ultimate objectives of which are to enhance cash flow and
realize further value from our reserves and resources. Our
current plans are to drill up to three development wells and two
appraisal wellbores funded from cash on hand and cash generated
from operations. The development wells will all be drilled
from our existing platforms where the infrastructure is in place to
bring production online quickly. The appraisal wellbores are
expected to help further define existing leads that may potentially
add reserves and de-risk future drilling locations.”
Bounds continued, “In addition, we have
successfully completed our periodic full-field maintenance shutdown
at Etame and most importantly, there were no safety or
environmental incidents with production restored to pre-shutdown
levels. Our relationship with our FPSO provider remains
positive, so we extended the FPSO contract for another year through
September 2021. By maintaining operational excellence, we are
very pleased to have positioned the Company to deliver material
organic growth through development drilling and create value for
our shareholders.”
2019/2020 Drilling Program
Vantage Drilling International has notified
VAALCO that they expect to release the Topaz jackup rig to VAALCO
in early September following completion of ENI Gabon’s drilling
operations. VAALCO plans to spud the Etame 9P appraisal
wellbore first, followed back-to-back with the Etame 9H development
well. The Company plans to drill up to three development
wells and two appraisal wellbores in the 2019/2020 drilling
program. VAALCO believes that there is significant reserve upside
associated with the two appraisal wellbores as they may confirm up
to approximately five million net barrels of 2P oil reserves spread
across six well locations targeted in future drilling
campaigns. The Company is forecasting that the 2019/2020
drilling program will be funded by cash on hand and cash generated
from operations. The current estimated net drilling capital
expenditures are $20 million to $25 million in 2019 with an
additional $5 to $10 million of expenditures in 2020.
Gabon Operational Update
During August 2019, VAALCO completed its planned
full field 2019 maintenance shutdown for the Etame Marin FPSO and
four platforms. The entire work scope was completed
successfully with no adverse environmental or safety
incidents. The field was shut-in for approximately nine days
during the shutdown and then returned to pre-shutdown production
levels.
VAALCO has exercised an election to extend the
lease contract for the FPSO Petróleo Nautipa at Etame through
September 2021, with an additional one-year option to run through
September 2022.
About VAALCO
VAALCO Energy, Inc. is a Houston-based
independent energy company principally engaged in the acquisition,
development and production of crude oil. The Company's properties
and acreage are located primarily in Gabon and Equatorial Guinea in
West Africa.
Forward Looking Statements
This document includes "forward-looking
statements" within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. All statements, other than statements of
historical facts, included in this document that address
activities, events, plans, expectations, objectives or developments
that VAALCO expects, believes or anticipates will or may occur in
the future are forward-looking statements. Forward-looking
statements include all statements regarding wells anticipated
to be drilled and placed on production, future levels of drilling
activity and associated production and cash flow expectations, the
Company's 2019 guidance and capital expenditure forecast, estimated
reserve quantities and the present value thereof, the
implementation of the Company's business plans and strategy,
expected sources of future capital funding and future
liquidity, future operating losses, future changes in oil and
natural gas prices, future strategic alternatives, prospect
evaluations, negotiations with governments and third parties,
expectations regarding processing facilities, production and sales
projections, and reserve growth, as well as statements including
the words "believe," "expect," "plans" and words of similar
meaning. These statements are based on assumptions made by VAALCO
based on its experience and perception of historical trends,
current conditions, expected future developments and other factors
it believes are appropriate in the circumstances. No
assurances can be given, however, that these events will occur or
that these projections will be achieved, and actual results could
differ materially from those projected as a result of certain
factors. Some of the factors which could affect our future results
and could cause results to differ materially from those expressed
in our forward-looking statements include oil and gas price
volatility, inflation, general economic conditions, the Company's
success in discovering, developing and producing reserves,
production and sales differences due to timing of liftings,
decisions by future lenders, the risks associated with liquidity,
lack of availability of goods, services and capital, environmental
risks, drilling risks, foreign regulatory and operational risks,
and regulatory changes.
These and other risks are further described in
VAALCO's annual reports on Form 10-K and quarterly reports on Form
10-Q and other reports filed with the U.S. Securities and Exchange
Commission (“SEC”) which can be reviewed at http://www.sec.gov, or
which can be received by contacting VAALCO at 9800 Richmond Avenue,
Suite 700, Houston, Texas 77042, (713) 623-0801. VAALCO
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise.
Supplemental Non-GAAP Financial
Measure
Probable and Potential Reserves
This press release contains oil and gas metrics,
which do not have standardized meanings or standard methods of
calculation as classified by the SEC and therefore such measures
may not be comparable to similar measures used by other companies.
Such metrics have been included herein to provide readers with
additional measures to evaluate the Company’s performance; however,
such measures are not reliable indicators of the future performance
of the Company and future performance may not compare to the
performance in previous periods.
Investor Contact Al Petrie
713-543-3422
Vaalco Energy (NYSE:EGY)
Historical Stock Chart
From Mar 2024 to Apr 2024
Vaalco Energy (NYSE:EGY)
Historical Stock Chart
From Apr 2023 to Apr 2024