E. Guinea Accepts Vaalco Development Plan For Venus Project

The Government of Equatorial Guinea has accepted Vaalco Energy’s plan of development (POD) for the Venus – Block P project.

Vaalco has an 80 percent participation interest in the project and is the operator. Upon the execution of final documents, the company will proceed directly to project execution which targets first oil in 2026 and adds 23.1 million barrels of oil of 2P CPR gross reserves and 18.5 million barrels of oil of 2P CPR Working Interest.

The company added that the reserves include 9.1 million barrels of oil of WI proved undeveloped reserves. Block P also has additional future upside with the Europa development and exploration upside with Saturno and Southwest Grande prospects.

This allows Vaalco to proceed with the development of the Venus discovery with plans to spud the first development well in early 2024, acquire, convert, and install production facilities over the next three years as well as spud an additional development and a water injection well in 2025 or 2026.

Vaalco estimates the preliminary project cost of drilling two development wells, an injection well, and a related production facility to be approximately $310 million gross, or around $13.40 per barrel of 2P gross reserves.

Based on results from the initial discovery well and reservoir modeling, Vaalco expects production from the field to reach approximately 15,000 gross barrels of oil per day upon completion of the two development wells and injector well.

"With the approval of the POD, and upon execution of final documents, we are very excited to proceed with our plans to operate, develop and begin producing from our discovery at Block P in Equatorial Guinea over the next few years. We have a strong and highly economic plan of development in place and are looking forward to working with our carried partner GEPetrol and the Equatorial Guinea government in efficiently developing this exciting discovery.”

“We believe that adding another asset to our portfolio with significant 2P WI CPR is a very positive step for Vaalco and further demonstrates the meaningful value of our asset base. We believe that Block P in Equatorial Guinea has the upside potential to become a world-class asset in line with our Etame asset and see clear strategic benefits in diversifying the revenue generation and country focus of our portfolio.”

“Vaalco has a proven operating track record for a development of this kind, and we look forward to demonstrating these capabilities as we progress Block P into production. As you can see, we are very excited for the future of Vaalco and believe that we can significantly enhance shareholder value through the drill bit on our outstanding assets," George Maxwell, the company’s CEO, said.

On July 15, 2022, Vaalco submitted to Equatorial Guinea a plan of development for the Venus development in Block P. The other Block P joint venture owner, Atlas Petroleum International, opted not to participate in the POD.

On September 16, 2022, the country approved Vaalco’s POD. As a result, the company will hold an 80 percent working interest in the Venus development in Block P and GEPetrol will hold a 20 percent carried interest. The Block P PSC provides for a development and production period of 25 years from the date of approval of the POD.

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