VAALCO Energy, Inc. (NYSE: EGY) is experiencing a significant uptick of 12.59% as of the latest assessment today, with its trading value reaching $6.95. The revelation of a substantial agreement seems to be the driving force behind the noteworthy surge in EGY shares.
The company, VAALCO (EGY), disclosed that all stakeholders have ratified the final documents, and the Government of Equatorial Guinea has given approval to the Joint Operating Agreement (“JOA”) linked with the previously sanctioned Venus-Block P Plan of Development (“POD”). The Block P Production Sharing Contract (“PSC”) stipulates a 25-year development and production period from the POD’s approval date.
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Having concluded the final paperwork for Block P, VAALCO can now advance its plans to develop, operate, and commence production from the Block P discovery offshore Equatorial Guinea in the forthcoming years. The company will proceed with the Front-End Engineering Design (“FEED”) study.
After the FEED study is finished, VAALCO anticipates that an economically sound Final Investment Decision, or “FID,” will be made, which will enable the Venus POD to be developed. VAALCO has expanded its portfolio dramatically in the last several years, which has improved its ability to produce operating cash flow, increase cash reserves, and stay debt-free.
Block P development will add another strong producing asset to VAALCO’s worldwide portfolio, enhancing the company’s portfolio even further. In addition to having a track record of successful operational advances in this area, VAALCO is well-positioned to carry out initiatives within its enlarged portfolio.
Concurrently, Svenska Petroleum Exploration AB (“Svenska”), a privately held exploration and production (“E&P”) firm with its headquarters located in Stockholm, Sweden, was recently acquired by VAALCO through the execution of a sales and purchase agreement (“SPA”). The main asset owned by Svenska is a 27.39% non-operated working interest in Block CI-40, which is offshore Cote d’Ivoire in West Africa, and contains the deepwater producing Baobab field.
