VAALCO Energy, Inc. Announces Early Repayment of IFC Debt and that the Workover Program Is Now Underway
May 22 2018 - 4:45PM
VAALCO Energy, Inc. (NYSE:EGY) today announced that its subsidiary
has paid off the outstanding balance on its Amended Term Loan
Agreement with the International Finance Corporation (“IFC”) and
begun workover operations last week to restore production to two
wells currently shut-in on the Avouma platform.
Highlights and Recent Key Items:
- Eliminated $7.0 million of outstanding debt with IFC, with cash
on hand;
- Results in savings of over $0.3 million in interest over the
next year;
- Began workover operations on the Avouma platform on May 17,
2018 to replace electric submersible pumps (“ESPs”) in the Avouma
2-H and South Tchibala 1-HB wells;
- Estimates net production of approximately 750 net barrels of
oil per day (“BOPD”) may be restored if both workovers are
successful.
Cary Bounds, Chief Executive Officer commented,
“We are realizing significant cash flow generation due to the
strong improvement in Brent oil prices with no hedges currently in
place. This is allowing us to eliminate all of our outstanding debt
and strengthen our balance sheet. We are improving our financial
position in anticipation of a development drilling campaign on our
offshore Gabon asset in 2019. In addition, our workover
operations to restore production from two shut-in wells on the
Avouma platform have commenced. We are hopeful that
modifications to the design of the downhole ESP equipment,
improvements in the installation procedures and upgrades to the
surface control systems on the platform will result in improved
operational reliability. With the additional 750 net BOPD of
production that these wells could bring back online if the workover
operations are successful, coupled with higher Brent pricing, we
will continue to enhance our ability to generate cash in
2018.”
At March 31, 2018, debt, net of deferred
financing costs, totaled $7.0 million. The total payoff amount for
the principal and accrued interest since March 31, 2018 was
approximately $7.2 million. VAALCO now has no debt on the balance
sheet for the first time since June 30, 2014.
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.
Investor Contact Phil Patman,
Jr. 713-623-0801
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