VAALCO Energy has reported operational and financial results for the third quarter of 2025.
Third Quarter 2025 Highlights and Recent Key Items:
- Reported net income of $1.1 million ($0.01 per diluted share), Adjusted Net Loss(1) of $10.3 million ($(0.10) per diluted share) and Adjusted EBITDAX(1) of $23.7 million;
- Produced 15,405 net revenue interest (“NRI”)(2) barrels of oil equivalent per day (“BOEPD”), at the high end of guidance, or 19,887 working interest (“WI”)(3) BOEPD, above the midpoint of guidance;
- Sold 12,831 NRI BOEPD, at the high end of guidance;
- Increased full year production and sales guidance midpoints due to strong quarterly performance that has been near the high end of guidance through the first nine months of 2025;
- Further decreased full year capital guidance midpoint by 19% or $58 million from original 2025 guidance; and
- Declared quarterly cash dividend of $0.0625 per share of common stock to be paid on December 24, 2025.
(1) Adjusted EBITDAX, Adjusted Net Income (Loss), Adjusted Working Capital and Free Cash Flow are Non-GAAP financial measures and are described and reconciled to the closest GAAP measure in the attached table under “Non-GAAP Financial Measures.”
(2) All NRI sales and production rates are Vaalco's working interest volumes less royalty volumes, where applicable.
(3) All WI production rates and volumes are Vaalco's working interest volumes, where applicable.
George Maxwell, Vaalco’s Chief Executive Officer, commented, 'We continue to deliver consistent quarterly results that either meet or exceed our guidance. Both our sales and NRI production for the third quarter of 2025 were above the midpoint of guidance, leading to solid financial results. We have positively adjusted our full year 2025 guidance taking into account the production and sales results through the first nine months of the year. Additionally, we have decreased the midpoint of our full year capital guidance twice this year, for a total of $58 million, all while raising full year production expectations driven by operational efficiency and well performance. We also have kept absolute production expense in line with previous guidance and with the increased sales, we are seeing a reduction on our per barrel costs against original guidance. Our track record of success in delivering results at or above expectations should provide our investors with assurance that we will execute on the portfolio of opportunities we discussed in the Capital Markets Day presentation back in May.'
'We are well positioned to deliver growth as we prepare for multiple production enhancing drilling campaigns across our diversified asset base. In Côte d’Ivoire, the FPSO refurbishment project is well underway, with the vessel at the shipyard in Dubai and we are preparing for a drilling campaign in 2026 to augment the production and economic life of the Baobab field. In Gabon, we have been waiting for the 2025/2026 drilling program to commence once the contracted rig completes its current commitments. The rig is completing its final well commitment and we expect it to arrive at Etame to begin our drilling campaign in late November. In Egypt, we continue to efficiently drill wells and the success of the program has benefitted our production results. As a reminder, in the first quarter of 2025, we entered into a new reserves-based credit facility to supplement our internally-generated cash flow and cash balance to assist in funding our robust organic growth projects. Shortly after the third quarter, we successfully completed our semi-annual redetermination with the lenders and have increased their commitments on the $300 million facility from $190 million to $240 million, increasing our available liquidity. This enhances our ability to fund the significant growth and opportunities that we have planned over the next few years as we seek to drive the next phase of growth and generate meaningful value for our shareholders for the remainder of the decade.'
Operational Update
Gabon
The Company secured a drilling rig in December 2024 in conjunction with its 2025/2026 drilling program, which is expected to begin during the fourth quarter of 2025, once the drilling rig completes its current commitments. The program includes drilling multiple development wells, and appraisal or exploration wells, and perform workovers, with options to drill additional wells. Vaalco plan to drill wells at both the Etame platform and at its Seent platform, as well as a re-drill and a number of workovers in the Ebouri field to access production and reserves that were previously removed from proved reserves due to the presence of hydrogen sulfide.
In July 2025, the Company performed planned, staged shutdowns of the Gabon platforms to perform safety inspections and necessary maintenance to increase the integrity and reliability of the assets. This is the first full field maintenance shutdown that Vaalco has performed since the new Floating Storage and Offloading vessel (“FSO”) was brought online in 2022. All fields were successfully brought back online and the planned turnaround was completed on budget and with no safety or environmental incidents.
Egypt
The current drilling campaign in Egypt began in December 2024 and has continued through the third quarter of 2025. During the third quarter of 2025, four development wells were drilled in the Eastern Desert, of which three were completed during the same period and the fourth well was completed in October 2025. Also, during the third quarter of 2025, Vaalco drilled one exploration well in the Western Desert which was completed in October 2025. Additionally, continuous well interventions, workovers and optimization activities were carried out throughout the third quarter of 2025 to enhance production levels.
Canada
In early 2025, the Company decided to defer the drilling of additional wells in Canada based on a reassessment of capital allocation priorities across the portfolio and to ensure that investment is directed toward projects with the highest expected returns. Therefore, the Canadian division is looking towards lower-cost optimization projects to enhance productivity by year-end.
Côte d'Ivoire
As part of the planned dry dock refurbishment, the Baobab Floating Production, Storage and Offloading (“FPSO”) vessel ceased hydrocarbon production on January 31, 2025 and the final lifting of crude oil from the FPSO took place in February 2025. The vessel departed from the field in late March 2025 and arrived at the shipyard in Dubai ahead of schedule in mid-May 2025. The FPSO refurbishment is progressing well and has now been underway for the last five months in the shipyard. A rig has been secured for significant development drilling which is expected to begin in 2026 after the FPSO returns to service, potentially bringing meaningful additions to production from the main Baobab field in CI-40. The Company is also evaluating the potential future development of the Kossipo field, which is on the CI-40 license.
Equatorial Guinea
Vaalco owns a 60% working interest in an undeveloped portion of Block P offshore Equatorial Guinea where it is the designated operator. The Company has an existing plan of development of the Venus field discovery on Block P, which focuses on key areas of drilling evaluations, facilities design, market inquiries and metocean review. Vaalco has completed the initial Front End Engineering and Design study that confirmed the viability of the development concept and is currently evaluating alternative technical solutions which may deliver enhanced economic value.
Financial Update – Third Quarter of 2025
Vaalco reported net income of $1.1 million ($0.01 per diluted share) for Q3 2025 which was down compared with net income of $8.4 million ($0.08 per diluted share) in Q2 2025 and net income of $11.0 million ($0.10 per diluted share) in Q3 2024. The decrease in earnings compared with Q2 2025 was driven by lower realized pricing and lower sales volume in Q3 2025 of 1,180 MBOE compared to a sales volume of 1,765 MBOE in Q2 2025 partially offset by lower production expense, depreciation, depletion and amortization (“DD&A”), and lower income tax expense.
Adjusted EBITDAX totaled $23.7 million in Q3 2025, compared with $49.9 million in Q2 2025. The decrease was primarily due to lower realized pricing and lower sales volumes partially offset by lower production expense. Adjusted EBITDAX was down from $92.8 million generated in Q3 2024 primarily due to lower realized pricing and lower sales volumes.
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Source: VAALCO Energy
