VAALCO Announces Avouma Test Results

VAALCO Energy announced the results of flow testing of the Avouma exploration well. The EAVOM-1 well flowed at a stabilized rate of 6,600 barrels oil per day of 37 degree API crude on a 40/64's inch choke from twenty feet of perforations in the Gamba sandstone section. Flowing wellhead pressure was 746 psi. The rig is currently performing additional diagnostic work after which the plan is to temporarily abandon the well. The Avouma discovery is located offshore Gabon on the Etame permit approximately 10.5 miles from the Etame field, where VAALCO is currently producing 15,000 barrels oil per day.

After completing operations on the EAVOM-1 well, VAALCO plans to return to the Etame 5H development well in the Etame field. That well was temporarily suspended last month at the top of the Gamba sandstone in a horizontal position, while flowlines were run to tie the well back to the floating production storage and offloading system moored in the field. The flowlines have been successfully installed, and the remaining operations to complete the Etame 5H well consist of drilling a 2,000 foot horizontal lateral in the Gamba sandstone, which will be gravel-packed for sand control. Commencement of production from the Etame 5H well later this month is expected to increase total production from the Etame field to over 20,000 barrels oil per day.

VAALCO's subsidiary VAALCO Gabon Etame, Inc. operates and owns a 28.07% interest in the Etame Field. The Etame field was placed on production in September 2002 and has produced between 14,500 and 15,000 barrels per day since startup. Other field partners are PanAfrican Energy Gabon Corp. (31.36%), Sasol Petroleum West Africa (Ltd.) (27.75%), Sojitz Etame Limited (2.98%), PetroEnergy Resources Corp. (2.34%) and Energy Africa Gabon (7.5%).