VAALCO will also acquire Sasol’s 40% non-operated participating interest in Block DE-8 offshore Gabon
US-based hydrocarbon exploration VAALCO Energy has signed an agreement with Sasol Gabon to acquire an additional working interest in the Etame Marin block offshore Gabon.
Under the terms of the agreement, VAALCO will acquire Sasol’s 27.8% working interest in the Etame Marin block.
At present, the company owns and operates a 31.1% working interest in the block, which has produced over 118 million barrels of crude oil to date.
Additionally, VAALCO will also acquire Sasol’s 40% non-operated participating interest in Block DE-8 offshore Gabon. Perenco, the operator of the block, will hold the remaining 60% stake.
VAALCO stated: “Block DE-8 is in shallow waters and encompasses multiple producing fields that are not part of the transaction and are carved out of the contract area that VAALCO is acquiring.”
For the entire transaction, the company has agreed to pay $44m to Sasol, subject to customary post-effective date adjustments, as well as future contingent payments of up to $6m.
VAALCO to double total production and reserves with the deal
Upon completion of the deal, VAALCO’s total working interest will increase to 58.8% in the offshore Etame Marin block and almost double its total production and reserves.
Based on current month production, the company estimates its net revenue interest (NRI) production to increase from 4,850 to 9,150 barrels of oil per day (BOPD), with the acquisition.
In February this year, VAALCO Energy had confirmed making an oil discovery in the Etame Marin block, after drilling the South East Etame 4P appraisal wellbore.
The appraisal wellbore was drilled by the company-operated South East Etame North Tchibala platform (SEENT platform),