{"id":10012,"date":"2021-03-01T19:08:00","date_gmt":"2021-03-01T19:08:00","guid":{"rendered":"https:\/\/oilnewskenya.com\/?p=10012"},"modified":"2021-03-01T19:09:35","modified_gmt":"2021-03-01T19:09:35","slug":"vaalco-closes-the-acquisition-of-additional-interest-in-the-etame-field-from-sasol","status":"publish","type":"post","link":"https:\/\/www.oilnewskenya.com\/index.php\/vaalco-closes-the-acquisition-of-additional-interest-in-the-etame-field-from-sasol\/","title":{"rendered":"GABON: VAALCO Closes the Acquisition of Additional Interest in the Etame Field From Sasol"},"content":{"rendered":"<p align=\"justify\"><strong>Key Highlights<\/strong><\/p>\n<ul>\n<li>Nearly doubles VAALCO\u2019s total net production and reserves;<\/li>\n<li>Expected to be immediately accretive to VAALCO, with minimal additional variable costs;<\/li>\n<li>Anticipated to materially increase free cash flow\u00a0in 2021 and beyond, particularly in the current increasing price environment;<\/li>\n<li>Paid $29.6 million in cash to Sasol, taking into account the agreed upon transaction price of $44 million, the deposit already paid and post-effective date adjustments, with a future contingent payment of up to $5 million; and<\/li>\n<li>Funded the closing of the acquisition entirely from cash on hand and cash from operations.<\/li>\n<\/ul>\n<p align=\"justify\">Cary Bounds, Chief Executive Officer, commented, \u201cWe are extremely pleased to close this transformational and accretive transaction in a rising price environment. All cash payments were funded entirely by cash on hand. 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.\u201d<\/p>\n<p align=\"justify\">The transaction had an economic effective date of July 1, 2020. Taking into account the $4.3 million deposit, net cash flow from the Sasol interest through closing and other purchase price adjustments, VAALCO paid $29.6 million to Sasol at closing from cash on hand. VAALCO\u2019s reserves, production and financial results for the Sasol interest being acquired will be included in the Company\u2019s results for periods after the closing date of the transaction.<\/p>\n<p align=\"justify\"><strong>Contingent Payments<\/strong><\/p>\n<p align=\"justify\">Under the terms of the agreement, a contingent payment of $5 million will be payable to Sasol by VAALCO if Brent oil pricing averages greater than $60 per barrel for 90 consecutive days during the period from July 1, 2020 to June 30, 2022.<\/p>\n<p align=\"justify\"><em>(1)\u00a0Prior to the closing of the acquisition, VAALCO\u2019s working interest in Etame was 31.1% and its participating interest was 33.6%; Sasol\u2019s working interest in Etame was 27.8% and its participating interest was 30%. All NRI production rates and volumes are based on working interest less 13% royalty volumes.<\/em><br \/>\n<em>(2)\u00a0Free cash flow is calculated as (i) revenues less production expenses, general and administrative expense, annual abandonment funding and current income tax expense divided by (ii) the number of NRI barrels of oil sold.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Highlights Nearly doubles VAALCO\u2019s total net production and reserves; Expected to be immediately accretive to VAALCO, with minimal additional variable costs; Anticipated to materially increase free cash flow\u00a0in 2021 &hellip; <a href=\"https:\/\/www.oilnewskenya.com\/index.php\/vaalco-closes-the-acquisition-of-additional-interest-in-the-etame-field-from-sasol\/\" class=\"more-link\">Read More<\/a><\/p>\n","protected":false},"author":24,"featured_media":9241,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[7442,11,7444],"tags":[8952,2249,8532],"class_list":["post-10012","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-countries","category-top-news","category-west-africa","tag-etame","tag-sasol","tag-vaalco","entry"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2020\/10\/GABON-ETAME.jpg?fit=376%2C485&ssl=1","jetpack_shortlink":"https:\/\/wp.me\/p5JWkQ-2Bu","jetpack-related-posts":[{"id":9432,"url":"https:\/\/www.oilnewskenya.com\/index.php\/gabon-vaalco-acquires-additional-working-interest-at-etame-marin-block\/","url_meta":{"origin":10012,"position":0},"title":"GABON: VAALCO  Acquires Additional Working Interest at Etame Marin Block","author":"","date":"November 19, 2020","format":false,"excerpt":"Highlights \u2022 Acquiring an additional 27.8% working interest in the Etame Marin block offshore Gabon, increasing VAALCO\u2019s total working interest to 58.8%; \u2022 Nearly doubles VAALCO\u2019s total net production and reserves; \u2022 Increases net revenue interest (\u201cNRI\u201d) production from 4,850 to 9,150 barrels of oil per day (\u201cBOPD\u201d) based on\u2026","rel":"","context":"In &quot;Central Africa&quot;","block_context":{"text":"Central Africa","link":"https:\/\/www.oilnewskenya.com\/index.php\/category\/countries\/central-africa\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2020\/10\/GABON-ETAME.jpg?fit=376%2C485&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":9613,"url":"https:\/\/www.oilnewskenya.com\/index.php\/gabon-etame-marine-block-jv-partners-their-pre-emptive-rights\/","url_meta":{"origin":10012,"position":1},"title":"GABON: Etame Marine Block JV Partners Waive Their Pre-Emptive Rights","author":"","date":"January 3, 2021","format":false,"excerpt":"VAALCO Energy has announced that, in connection with VAALCO\u2019s previously announced acquisition from Sasol Gabon S.A.\u00a0 of Sasol\u2019s 27.8% working interest in the Etame Marin block offshore Gabon, the other joint owners in the Etame Marin block have not exercised their pre-emptive rights. As a result, VAALCO will now move\u2026","rel":"","context":"In &quot;Central Africa&quot;","block_context":{"text":"Central Africa","link":"https:\/\/www.oilnewskenya.com\/index.php\/category\/countries\/central-africa\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2020\/10\/GABON-ETAME.jpg?fit=376%2C485&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":9781,"url":"https:\/\/www.oilnewskenya.com\/index.php\/vaalco-enters-into-crude-oil-derivative-contracts\/","url_meta":{"origin":10012,"position":2},"title":"VAALCO Enters Into Crude Oil Derivative Contracts","author":"","date":"January 29, 2021","format":false,"excerpt":"VAALCO Energy has entered into crude oil commodity swap agreements for a total of 709,262 barrels at a Dated Brent weighted average price of $53.10 per barrel for the period from and including February 2021 through January 2022.\u00a0 These swaps will settle on a monthly basis. The Company is hedging\u2026","rel":"","context":"In &quot;Top News&quot;","block_context":{"text":"Top News","link":"https:\/\/www.oilnewskenya.com\/index.php\/category\/top-news\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2020\/10\/GABON-ETAME.jpg?fit=376%2C485&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":12266,"url":"https:\/\/www.oilnewskenya.com\/index.php\/vaalco-energy-receives-new-five-year-50-million-reserve-based-lending-facility\/","url_meta":{"origin":10012,"position":3},"title":"VAALCO Energy Receives New Five Year, $50 Million Reserve Based Lending Facility","author":"","date":"May 18, 2022","format":false,"excerpt":"VAALCO Energy has announced entry into a new credit agreement, effective May 16, 2022, for a new five-year Reserve Based Lending facility with Glencore Energy UK Ltd.\u00a0 that includes an initial commitment of $50 million and is expandable up to $100 million. Highlights Significantly improves financial flexibility providing optionality to\u2026","rel":"","context":"In &quot;Central Africa&quot;","block_context":{"text":"Central Africa","link":"https:\/\/www.oilnewskenya.com\/index.php\/category\/countries\/central-africa\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2022\/04\/GABON-ETAME.jpg?fit=376%2C485&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":11066,"url":"https:\/\/www.oilnewskenya.com\/index.php\/gabon-vaalco-successfully-completes-two-etame-field-well-workovers\/","url_meta":{"origin":10012,"position":4},"title":"GABON: VAALCO Successfully Completes Two Etame Field Well Workovers","author":"","date":"November 1, 2021","format":false,"excerpt":"VAALCO Energy has announced that it has completed the two previously-announced workovers at the Etame field offshore Gabon and added a total of approximately 1,050 gross barrels of crude oil per day, (540 net BOPD to VAALCO). Highlights Include: Utilized VAALCO\u2019s mobile hydraulic workover unit, which was purchased in early\u2026","rel":"","context":"In &quot;Countries&quot;","block_context":{"text":"Countries","link":"https:\/\/www.oilnewskenya.com\/index.php\/category\/countries\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2020\/10\/GABON-ETAME.jpg?fit=376%2C485&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":9240,"url":"https:\/\/www.oilnewskenya.com\/index.php\/gabon-vaalco-announces-new-3-d-seismic-survey-over-entire-etame-marin-block\/","url_meta":{"origin":10012,"position":5},"title":"GABON: VAALCO Announces New 3-D Seismic Survey Over Entire Etame Marin Block","author":"","date":"October 3, 2020","format":false,"excerpt":"VAALCO Energy has announced that in connection with planning for future drilling programs at the Etame Marin block offshore Gabon, it will begin acquiring and processing new three-dimensional (3-D) seismic data in the fourth quarter of 2020. Committed to acquiring new proprietary 3-D dual-azimuth seismic data over the entire Etame\u2026","rel":"","context":"In &quot;Central Africa&quot;","block_context":{"text":"Central Africa","link":"https:\/\/www.oilnewskenya.com\/index.php\/category\/countries\/central-africa\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.oilnewskenya.com\/wp-content\/uploads\/2020\/10\/GABON-ETAME.jpg?fit=376%2C485&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]}],"jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/posts\/10012","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/users\/24"}],"replies":[{"embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/comments?post=10012"}],"version-history":[{"count":2,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/posts\/10012\/revisions"}],"predecessor-version":[{"id":10014,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/posts\/10012\/revisions\/10014"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/media\/9241"}],"wp:attachment":[{"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/media?parent=10012"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/categories?post=10012"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.oilnewskenya.com\/index.php\/wp-json\/wp\/v2\/tags?post=10012"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}