VAALCO closes acquisition of additional interest in Etame Field from Sasol

Vaalco oil rigVAALCO Energy Inc has completed the previously announced acquisition of Sasol Gabon SA’s 27.8% working interest in the Etame Marin block offshore Gabon, increasing the company’s total working interest to 58.8%

Cary Bounds, CEO, commented, “With the additional production from the acquisition, we are forecasting significant cash flow generation in 2021. In addition, we believe the recently acquired 3D seismic will improve our subsurface interpretation at Etame and lead to another successful drilling campaign, starting late this year or early next year, funded from cash on hand and cash from operations.”

“Sustained operational and robust financial performance at Etame serves as the foundation for growing the company through future accretive acquisition opportunities in line with our strategy and operational expertise in West Africa.”

The transaction had an economic effective date of 1 July 2020. Taking into account the US$4.3mn deposit, net cash flow from the Sasol interest through closing and other purchase price adjustments, VAALCO paid US$29.6mn to Sasol at closing from cash on hand. VAALCO’s reserves, production and financial results for the Sasol interest being acquired will be included in the company’s results for periods after the closing date of the transaction.

VAALCO is an established operator within the region, holding a 63.6% participating interest in the Etame Marin block, located offshore Gabon, which to date has produced more than 120 mmbbl of crude oil and of which the company is the operator.

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