VAALCO Energy Reports Q2 2025 Financial Results with $8.4M Net Income

VAALCO Energy, Inc. reported its financial results for the second quarter of 2025, revealing a net income of $8.4 million, a significant decrease from $28.2 million in the same period last year. The company's revenues from crude oil, natural gas, and natural gas liquids sales totaled $96.9 million, down approximately 17% from $116.8 million in the second quarter of 2024. This decline was primarily attributed to lower revenues from its Côte d'Ivoire and Canada segments, despite an increase in Gabon revenues due to higher sales volumes.

In terms of operational costs, VAALCO managed to reduce total operating expenses to $79.7 million from $96.5 million year-over-year, driven by a decrease in production expenses, which fell by 23% to $40.4 million. The company also reported a decrease in depreciation, depletion, and amortization costs, which dropped to $28.3 million from $33.1 million. However, general and administrative expenses increased by 12% to $8.5 million, reflecting higher professional service fees and salaries.

Strategically, VAALCO has made significant moves in its asset portfolio, including the acquisition of a 70% working interest in the CI-705 block offshore Côte d'Ivoire and the Baobab floating production, storage, and offloading vessel for a total of $20 million. These acquisitions are expected to enhance the company's operational capabilities and production potential in the region. The company also completed the acquisition of Svenska Petroleum Exploration Aktiebolag in April 2024, which contributed to a bargain purchase gain of $19.9 million.

Operationally, VAALCO's production metrics showed mixed results. The company reported an increase in crude oil sales volumes in Gabon, which rose to 900 MBbls in the second quarter of 2025, compared to 660 MBbls in the same quarter of 2024. However, production in Côte d'Ivoire was halted due to the ongoing refurbishment of the Baobab FPSO, which is expected to return to service in 2026. The company is also preparing for a drilling campaign in Gabon, set to commence in late 2025, which aims to enhance production and reserves.

Looking ahead, VAALCO anticipates continued challenges due to fluctuating commodity prices and geopolitical factors affecting the oil and gas market. The company remains focused on optimizing its asset portfolio and capitalizing on strategic opportunities to enhance shareholder value. With a cash balance of $67.9 million as of June 30, 2025, VAALCO is positioned to support its operational and capital expenditure needs in the coming months.