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Dec 31, 2020
VAALCO Q4 2020 Earnings Report
Reported operational and financial results with increased production and strategic acquisition.
Key Takeaways
VAALCO Energy reported a net loss of $3.6 million for Q4 2020, impacted by exploration expenses and a delayed lifting, though production increased due to new development wells. The company closed the Sasol acquisition, nearly doubling net production and reserves, and is planning a new drilling campaign.
Closed the acquisition of Sasol's working interest in the Etame field, nearly doubling VAALCO's net production and reserves.
Q4 2020 net production averaged 4,662 NRI BOPD.
Reported a net loss of $3.6 million ($0.06 per diluted share) and Adjusted EBITDAX of $3.5 million for Q4 2020.
Maintained a strong balance sheet with $47.9 million in cash and no debt as of December 31, 2020.
Forward Guidance
VAALCO anticipates increased production and sales volumes in 2021, driven by the Sasol acquisition, but also forecasts higher production expenses. The company is planning a drilling campaign and evaluating alternatives for its FPSO contract.
Positive Outlook
- Full year 2021 NRI production is estimated to be between 6,800 and 7,400 BOPD.
- Sales NRI volumes for 2021 are estimated to average 7,100 to 7,800 BOPD.
- VAALCO closed acquisition of Sasol’s interest in Etame field
- VAALCO is planning for the commencement of the next drilling campaign at Etame in late 2021 or early 2022.
- VAALCO estimates its net capital expenditures, excluding the 2021 drilling campaign and seismic, to total $3.0 million to $6.0 million.
Challenges Ahead
- All of VAALCO’s production estimates for 2021 include an estimated 15% annual natural decline in production.
- VAALCO’s production expense guidance (excluding workovers) for full year 2021 is expected to be between $69 million and $77 million.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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