VAALCO Closes The Acquisition Of Additional Interest In The Etame Field From Sasol
- Nearly doubles VAALCO’s total net production and reserves;
- Expected to be immediately accretive to VAALCO, with minimal additional variable costs;
- Anticipated to materially increase free cash flow in 2021 and beyond, particularly in the current increasing price environment;
- 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
- Funded the closing of the acquisition entirely from cash on hand and cash from operations.
Cary Bounds, Chief Executive Officer, commented, “We 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.”
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