VAALCO ENERGY INC /DE/

Previous wording

•the outcome of any governmental audit; and

Current wording

•the outcome of any governmental audit;

Previous wording

Vaalco is a Houston, Texas-based, African-focused independent energy company with strong production and reserve portfolio of assets in Gabon, Egypt, Equatorial Guinea, Canada, Nigeria and Côte d'Ivoire, currently engaged in the acquisition, exploration, development and production of crude oil, natural gas and NGLs.

Current wording

Vaalco is a Houston, Texas-based, African-focused independent energy company with strong production and reserve portfolio of assets in Gabon, Egypt, Equatorial Guinea, Nigeria, Côte d'Ivoire, as well as Canada. We are currently engaged in the acquisition, exploration, development and production of crude oil, natural gas and NGLs.

Previous wording

The Company paid a quarterly cash dividend of $0.0625 per share of common stock for the first quarter of 2025 ($0.25 annualized) on March 28, 2025 to stockholders of record at the close of business on February 28, 2025. The Company also announced its next quarterly cash dividend of $0.0625 per share of common stock for the second quarter of 2025 ($0.25 annualized) to be paid on June 27, 2025 to stockholders of record at close of business on May 23, 2025. Payment of future dividends, if any, will be at the discretion of the board of directors after taking into account various factors, including current financial condition, the tax impact of repatriating cash, operating results and current and anticipated cash needs.

Current wording

The Company paid a quarterly cash dividend of $0.0625 per share of common stock for the second quarter of 2025 ($0.25 annualized) on June 27, 2025 to stockholders of record at the close of business on May 23, 2025. The Company also announced its next quarterly cash dividend of $0.0625 per share of common stock for the third quarter of 2025 ($0.25 annualized) to be paid on September 19, 2025 to stockholders of record at close of business on August 22, 2025. Payment of future dividends, if any, will be at the discretion of the board of directors after taking into account various factors, including current financial condition, the tax impact of repatriating cash, operating results and current and anticipated cash needs.

Previous wording

The Company secured a drilling rig in December 2024 in conjunction with its 2025/2026 drilling program, which is planned to begin in late 2025 to drill multiple development wells, and appraisal or exploration wells, as well as to perform workovers, with options to drill additional wells. We plan to drill the wells at both the Etame platform and at our Seent platform, and a re-drill and several workovers in the Ebouri field to access production and reserves that were previously shut in and removed from proved reserves due to the presence of hydrogen sulfide.

Current wording

The Company secured a drilling rig in December 2024 in conjunction with its 2025/2026 drilling program, which is expected to begin near the end of the third quarter of 2025, as we wait for the drilling rig to complete its current commitments. The program includes drilling multiple development wells, and appraisal or exploration wells, and perform workovers, with options to drill additional wells. We plan to drill the wells at both the Etame platform and at our Seent platform, as well as a re-drill and several workovers in the Ebouri field to access production and reserves that were previously removed from proved reserves due to the presence of hydrogen sulfide.

Previous wording

In 2024, Vaalco drilled and completed four 2.75 mile lateral wells in Canada. These wells continue to meet production expectations and the Company is monitoring their longer-term performance for future drilling opportunities. In 2025, Vaalco has decided to defer the drilling of additional wells in Canada to reduce the Company's overall capital expenditures.

Current wording

In 2024, Vaalco drilled and completed five horizontal wells in Canada, with all laterals being greater than two miles long. These wells continue to meet production expectations and the Company is monitoring their longer-term performance for future drilling opportunities. In 2025, the Company has decided to defer the drilling of additional wells in Canada based on a reassessment of capital allocation priorities across the portfolio, ensuring that investment is directed toward projects with the highest expected returns.

Previous wording

As part of the planned dry dock refurbishment, the Baobab FPSO 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 is now currently under tow to the shipyard in Dubai for the refurbishment. Significant development drilling is expected to begin in 2026 after the FPSO is expected to return to service with meaningful additions to production from the main Baobab field in CI-40, as well as a potential future development of the Kossipo field, which is also on the license.

Current wording

As part of the planned dry dock refurbishment, the Baobab FPSO 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 now underway 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 bringing meaningful additions to production from the main Baobab field in CI-40. The Company is also evaluating the anticipated impact of the potential future development of the Kossipo field, which is also on the CI-40 license.

Previous wording

We own a 60% working interest in an undeveloped portion of Block P offshore Equatorial Guinea where we are the designated operator. We have an existing plan of development of the Venus field discovery on Block P (the “Venus Plan of Development”), which is currently on schedule and focuses on key areas of drilling evaluations, facilities design, market inquiries and metocean review. The Company is currently targeting to make a Final Investment Decision by the end of the second quarter of 2025.

Current wording

We own a 60% working interest in an undeveloped portion of Block P offshore Equatorial Guinea where we are the designated operator. We have 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. The Company is still reviewing a Front End Engineering and Design study and is currently targeting a Final Investment Decision by the end of 2025.

Previous wording

Our cash flows for the three months ended March 31, 2025 and 2024 are as follows:

Current wording

Our cash flows for the six months ended June 30, 2025 and 2024 are as follows:

Previous wording

The $10.9 million increase in net cash provided by operating activities during the three months ended March 31, 2025 compared to the three months ended March 31, 2024, was driven primarily by changes in operating assets and liabilities during the period. The net increase in changes provided by operating assets and liabilities of $3.7 million for the three months ended March 31, 2025 compared to the same period of 2024 was primarily related to the overall decrease in accrued liabilities and the foreign income taxes payable balance that was reduced with proceeds generated from the lifting of crude oil for the Gabon Oil Company as well as a decrease in the accrued liabilities other balances.

Current wording

The $29.7 million increase in net cash provided by operating activities during the six months ended June 30, 2025 compared to the six months ended June 30, 2024, was driven primarily by changes in operating assets and liabilities during the period. The net increase in changes provided by operating assets and liabilities of $32.3 million for the six months ended June 30, 2025 compared to the same period of 2024 was primarily related to the overall decrease in accrued liabilities and accounts payable, as well as the increase in collections from the Egypt receivables, value added tax and other receivables.

Previous wording

The $42.2 million change in net cash used in investing activities during the three months ended March 31, 2025 compared to the three months ended March 31, 2024, was due to costs associated with the development drilling programs in Egypt and Canada, as well as maintenance, project costs and long lead items for Gabon and Côte d'Ivoire. For the three months ended March 31, 2024, cash used in investing activities was due to capital spending costs associated with the development drilling programs in Egypt and Canada not exceeding prior year expenditures along with reduced current year expenditures for Gabon.

Current wording

The $58.8 million change in net cash used in investing activities during the six months ended June 30, 2025 compared to the six months ended June 30, 2024, was due to costs associated with the development drilling programs in Egypt, as well as maintenance, project costs and long lead items for Gabon and Côte d'Ivoire. For the six months ended June 30, 2024, cash used in investing activities was due to capital spending costs associated with the development drilling programs in Egypt and Canada not exceeding prior year expenditures along with reduced current year expenditures for Gabon. In addition, Vaalco used $40.2 million in cash for the acquisition of Svenska which is offset by the cash received from Svenska in the amount of $40.6 million.

Previous wording

Net cash used in financing activities during the three months ended March 31, 2025 included $6.6 million for dividend distributions, $5.1 million of payments for deferred financing costs and $2.9 million of principal payments on our finance leases. For the three months ended March 31, 2024, cash used in financing activities included $6.5 million for dividend distributions, $6.4 million for treasury stock repurchases made under our stock repurchase plan or as a result of tax withholding on options exercised and on vested restricted stock, and $2.1 million of principal payments on our finance leases partially offset by $0.5 million in proceeds from options exercised.

Current wording

Net cash used in financing activities during the six months ended June 30, 2025 included $13.1 million for dividend distributions, $6.9 million of payments for deferred financing costs and $6.3 million of principal payments on our finance leases, offset by $60.0 million in proceeds from borrowings under the 2025 RBL Facility. For the six months ended June 30, 2024, cash used in financing activities included $13.0 million for dividend distributions, $6.8 million for treasury stock repurchases made under our stock repurchase plan or as a result of tax withholding on options exercised and on vested restricted stock, and $4.2 million of principal payments on our finance leases partially offset by $0.5 million in proceeds from options exercised.

Previous wording

For the three months ended March 31, 2025, we had accrual basis capital expenditures of $51.3 million compared to $24.0 million accrual basis capital expenditures for the same period in 2024. For the three months ended March 31, 2025, our cash spending primarily related to the new wells drilled as part of the drilling campaign in Egypt as well as expenditures associated with the preparation of the FPSO dry dock project in Côte d'Ivoire. During the same period in 2024, our cash spending primarily related to the payments for the 2024 drilling campaigns in both Egypt and Canada.

Current wording

For the six months ended June 30, 2025, we had accrual basis capital expenditures of $92.2 million compared to $46.5 million accrual basis capital expenditures for the same period in 2024. For the six months ended June 30, 2025, our cash spending primarily related to the new wells drilled as part of the drilling campaign in Egypt as well as expenditures associated with the preparation of the FPSO dry dock project in Côte d'Ivoire. During the same period in 2024, our cash spending primarily related to the Svenska acquisition as well as payments for the 2024 drilling campaigns in both Egypt and Canada.

Previous wording

At March 31, 2025, we had unrestricted cash of $40.9 million. We invest cash not required for immediate operational and capital expenditure needs in short-term money market instruments primarily with financial institutions where we determine our credit exposure is negligible. As operator of the Etame Marin block in Gabon, we enter into project-related activities on behalf of our working interest joint venture owners. We generally obtain advances from joint venture owners prior to significant funding commitments. Our cash on hand will be utilized, along with cash generated from operations, to fund our operations and capital expenditures.

Current wording

At June 30, 2025, we had unrestricted cash of $67.9 million. We invest cash not required for immediate operational and capital expenditure needs in short-term money market instruments primarily with financial institutions where we determine our credit exposure is negligible. As operator of the Etame Marin block in Gabon, we enter into project-related activities on behalf of our working interest joint venture owners. We generally obtain advances from joint venture owners prior to significant funding commitments. Our cash on hand will be utilized, along with cash generated from operations, to fund our operations and capital expenditures.

Previous wording

Based on current expectations, we believe we have sufficient liquidity through our existing cash balances, cash flow from operations and our 2025 RBL Facility to support our current cash requirements during the next 12 months and beyond, including the FPSO charter, drilling programs, as well as transaction expenses and capital and operational costs associated with our business segments' operations. However, our ability to generate sufficient cash flow from operations or fund any potential future acquisitions, consortiums, joint ventures or pay dividends for other similar transactions depends on operating and economic conditions, some of which are beyond our control. If additional capital is needed, we may not be able to obtain debt or equity financing on terms favorable to us, or at all. We are continuing to evaluate all uses of cash, including opportunistic acquisitions, and whether to pursue growth opportunities and whether such growth opportunities, additional sources of liquidity, including equity and/or debt financings, are appropriate to fund any such growth opportunities.

Current wording

Based on current expectations, we believe we have sufficient liquidity through our existing cash balances, cash flow from operations and our 2025 RBL Facility to support our current cash requirements during the next 12 months and beyond, including the FPSO refurbishment, drilling programs, as well as transaction expenses and capital and operational costs associated with our business segments' operations. However, our ability to generate sufficient cash flow from operations or fund any potential future acquisitions, consortiums, joint ventures or pay dividends for other similar transactions depends on operating and economic conditions, some of which are beyond our control. If additional capital is needed, we may not be able to obtain debt or equity financing on terms favorable to us, or at all. We are continuing to evaluate all uses of cash, including opportunistic acquisitions, and whether to pursue growth opportunities and whether such growth opportunities, additional sources of liquidity, including equity and/or debt financings, are appropriate to fund any such growth opportunities.

Previous wording

Capital Projects - In December 2024, Vaalco secured a rig for the 2025/26 drilling campaign at Etame and is currently finalizing locations and planning for the next drilling campaign, which is expected to commence in the third quarter of 2025. We currently have a 10 to 15 well drilling campaign in Egypt, where we have completed the drilling of six wells.

Current wording

Capital Projects - In December 2024, Vaalco secured a rig for the 2025/26 drilling campaign at Etame and is currently finalizing locations and planning for the next drilling campaign, which is expected to begin near the end of the third quarter of 2025. In Egypt, additional drilling and completion activity is expected in the second half of 2025.

Previous wording

Commodity Prices– Historically, the markets for oil, natural gas and NGLs have been volatile. Oil, natural gas and NGLs prices are subject to wide fluctuations in supply and demand. Our cash flows from operations may be adversely impacted by volatility in crude oil and natural gas prices, a decrease in demand for crude oil, natural gas or NGLs and future production cuts by OPEC.

Current wording

Commodity Prices– Historically, the markets for oil, natural gas and NGLs have been volatile. Oil, natural gas and NGLs prices are subject to wide fluctuations in supply and demand. Our cash flows from operations may be adversely impacted by volatility in crude oil and natural gas prices, a decrease in demand for crude oil, natural gas or NGLs and future production cuts by OPEC. In addition, recent U.S. energy policy changes that prioritize domestic production and energy security, including through tax credits and development incentives, may influence global supply dynamics and capital flows, potentially altering the competitive landscape for international assets.

Previous wording

ESG and Climate Change Effects – Sustainability matters continue to attract considerable public, political, regulatory and scientific attention. In particular, we expect continued required reporting attention on climate change issues and emissions of greenhouse gases (“GHG”), including methane (a primary component of natural gas) and carbon dioxide (a byproduct of crude oil and natural gas combustion) and freshwater use. This increased attention to climate change and environmental stewardship coupled with increasing government incentives around renewable energy sources may result in demand shifts away from crude oil and natural gas products, higher regulatory and compliance costs, additional governmental investigations and private litigation against the oil and gas industry, including Vaalco. For example, numerous proposals have been made and are likely to continue to be made at the international, national, regional and state levels of government to monitor and limit emissions of GHGs. These efforts have included consideration of cap-and-trade programs, carbon taxes, voluntary efforts to reduce routine flaring, GHG reporting and tracking programs and regulations that directly limit GHG emissions from certain sources. In addition, institutional investors, proxy advisory firms and other industry participants continue to focus on environmental, social and governance (“ESG”) matters, including climate change. We expect that this heightened focus will continue to drive ESG efforts across our industry and influence investment and voting decisions, which for some investors may lead to less favorable sentiment towards carbon assets and diversion of investment to other industries. Consistent with the increased attention on ESG matters and climate change, we have prioritized and are committed to responsible environmental stewardship by monitoring our adherence to ESG reporting requirements, including establishing and communicating short and long-term goals and targets, furthering the reduction of our carbon footprint and measurement of GHG emissions. Sustainability remains an important topic to us, and we are in the process of developing a multi-year plan to establish targets to reduce emissions and document our progress in achieving goals we set for ourselves. Our plans will enable us to monitor and improve matters related to ESG and climate change going forward.

Current wording

The attention to climate change and environmental stewardship coupled with increasing government incentives around renewable energy sources may result in demand shifts away from crude oil and natural gas products, higher regulatory and compliance costs, additional governmental investigations and private litigation against the oil and gas industry, including Vaalco. For example, numerous proposals have been made and are likely to continue to be made at the international, national, regional and state levels of government to monitor and limit emissions of GHGs. These efforts have included consideration of cap-and-trade programs, carbon taxes, voluntary efforts to reduce routine flaring, GHG reporting and tracking programs and regulations that directly limit GHG emissions from certain sources. In addition, institutional investors, proxy advisory firms and other industry participants continue to focus on environmental, social and governance (“ESG”) matters, including climate change. We expect that this heightened focus will continue to drive ESG efforts across our industry and influence investment and voting decisions, which for some investors may lead to less favorable sentiment towards carbon assets and diversion of investment to other industries.

Previous wording

Climate-Related Disclosures – On March 27, 2025, the SEC ended its defense of the final rules on climate-related disclosures, effectively withdrawing its support for the regulation. The rules, which were adopted in March 2024, require publicly traded companies to disclose climate-related risks and greenhouse gas emissions. The SEC's decision to end its defense was made after a change in administration and a shift in policy, with Acting Chairman Mark Uyeda expressing concerns about the rule's costs and intrusiveness. While the rules remain on hold pending legal challenges, the SEC's withdrawal of support signals a potential shift in direction for climate disclosure regulations.

Current wording

Climate-Related Disclosures – On March 27, 2025, the SEC ended its defense of the final rules on climate-related disclosures, effectively withdrawing its support for the regulation. The rules, which were adopted in March 2024, require publicly traded companies to disclose climate-related risks and greenhouse gas emissions. The SEC's decision to end its defense was made after a change in administration and a shift in policy, with Acting Chairman Mark Uyeda expressing concerns about the rule's costs and intrusiveness. While the rules remain on hold pending legal challenges, the SEC's withdrawal of support signals a potential shift in direction for climate disclosure regulations. Despite this regulatory shift in the U.S., we remain committed to maintaining transparency and aligning with industry standards for similarly situated companies.

Previous wording

US activity notwithstanding, for the past three years, the Company has refined its reporting in line with the recommendations of the Task Force on Climate-related Financial Disclosures (“TCFD”), which is recognized as the global standard in climate-related reporting and required by Vaalco to report against through its listing on the London Stock Exchange. The full TCFD report was included within the Company's 2024 Sustainability Report (rather than in the Annual Report on Form 10-K or in the annual report which was published in connection with the annual meeting), as the Sustainability Report details environmental, social and governance matters of which the TCFD report forms an important part. The 2024 Sustainability Report is available on the Company's website.

Current wording

US activity notwithstanding, for the past three years, the Company has refined its reporting in line with the recommendations of the TCFD, which is recognized as the global standard in climate-related reporting and required by Vaalco to report against through its listing on the London Stock Exchange. The full TCFD report was included within the Company's 2024 Sustainability Report (rather than in the Annual Report on Form 10-K or in the annual report which was published in connection with the annual meeting), as the Sustainability Report details environmental, social and governance matters of which the TCFD report forms an important part. The 2024 Sustainability Report is available on the Company's website.

Previous wording

The Company considers itself aligned with both the TCFD's Governance and Strategy pillars and the recommendations therein. It does not consider itself aligned with Risk Management nor Metrics and Targets but has made meaningful progress against certain of the underlying recommendations and provides statements of intent to address these recommendations during 2025, including communicating its short-, mid- and long-range goals for emission reductions, beginning with its operated assets.

Current wording

The Company considers itself aligned with both the TCFD's Governance and Strategy pillars and the recommendations therein. During 2025, the Company has made meaningful progress against certain of the underlying recommendations of the TCFD’s Governance and Strategy pillars and provides statements of intent to address these recommendations, including communicating its short-, mid- and long-range goals for emission reductions, beginning with its operated assets.

Previous wording

Net income for the three months ended March 31, 2025 was $7.7 million compared to net income of $7.7 million during the same period of 2024. See discussion below for changes in revenue and expense.

Current wording

Net income for the three months ended June 30, 2025 was $8.4 million compared to a net income of $28.2 million during the same period of 2024. See discussion below for changes in revenues and expenses.

Previous wording

Crude oil sales in Gabon are a function of the number and size of crude oil liftings in each year and thus crude oil sales do not always coincide with volumes produced in any given year. The Company’s Gabon segment contributed $52.2 million of revenue to the Company’s total revenue during the three months ended March 31, 2025, a decrease of $5.3 million from the $57.5 million of revenue reported during the three months ended March 31, 2024. The decrease in revenues is primarily due to the lower average realized sales price received in Gabon of $79.25 per Bbl for three months ended March 31, 2025 compared to the $84.14 per Bbl average realized sales price received during the same period in 2024. In addition, sales volume in Gabon slightly decreased to 658 MBbls for the three months ended March 31, 2025 from the 669 MBbls sales volumes reported during the first quarter of 2024. Gabon's share of crude oil inventory, excluding royalty barrels, was approximately 276,299 barrels and 111,871 barrels at three months ended March 31, 2025 and 2024, respectively.

Current wording

Crude oil sales in Gabon are a function of the number and size of crude oil liftings in each year and thus crude oil sales do not always coincide with volumes produced in any given year. The Company’s Gabon segment contributed $58.6 million of revenue to the Company’s total revenue during the three months ended June 30, 2025, an increase of $4.9 million from the $53.7 million of revenue reported during the three months ended June 30, 2024. The increase in revenues is primarily due to a sales volume increase in Gabon from the 660 MBbls reported during the second quarter of 2024 to 900 MBbls for the three months ended June 30, 2025, offset by a lower average realized sales price received in Gabon of $65.02 per Bbl for three months ended June 30, 2025 compared to the $81.29 per Bbl average realized sales price received during the same period in 2024. Gabon's share of crude oil inventory, excluding royalty barrels, was approximately 54,776 barrels and 129,803 barrels at June 30, 2025 and 2024, respectively.

Previous wording

Crude oil sales in Egypt are either sold to a third party via a cargo lifting or sold directly to the government, through EGPC. During the three months ended March 31, 2025, the oil sold in Egypt was through direct sales to EGPC. The Company’s Egypt segment contributed$33.9 millionof revenue to the Company’s total revenue for the three months ended March 31, 2025, which is $3.1 million lower than the $37.0 million of revenue reported during the three months ended March 31, 2024. The decrease in revenues was primarily due to a decrease in average realized sales price from $57.68 per Bbl during the three months ended March 31, 2024 to $52.85 per Bbl during the same period in 2025. Sales volumes in Egypt remained relatively consistent at 642 MBbls and 641 MBbls, during the three months ended March 31, 2025 and 2024, respectively.

Current wording

Crude oil sales in Egypt are either sold to a third party via a cargo lifting or sold directly to the government, through EGPC. During the three months ended June 30, 2025, the oil sold in Egypt was through direct sales to EGPC. The Company’s Egypt segment contributed $33.3 million of revenue to the Company’s total revenue for the three months ended June 30, 2025, which is slightly lower than the $35.5 million of revenue reported during the three months ended June 30, 2024. The decrease in revenues was primarily due to a decrease in average realized sales price from $55.19 per Bbl during the three months ended June 30, 2024 to $48.01 per Bbl during the same period in 2025. Sales volumes in Egypt remained relatively consistent at 693 MBbls and 643 MBbls, during the three months ended June 30, 2025 and 2024, respectively.

Previous wording

Crude oil sales in Canada are normally sold through pipelines to a third party. The Company’s Canadian segment contributed $6.2 million of revenue to the Company’s total revenue for the three months ended March 31, 2025, or an increase of $0.5 million compared to $5.7 million of revenue reported during the three months ended March 31, 2024. The increase in revenues was primarily due to higher average realized sales price received of $34.61 per Boe during the three months ended March 31, 2025 compared to the $31.63 per Boe received during the first three months of 2024. Sales volumes in Canada were relatively flat during the three months ended March 31, 2025 at 179 MBoe in comparison to 180 MBoe in the same period in 2024.

Current wording

Crude oil sales in Canada are normally sold through pipelines to a third party. The Company’s Canadian segment contributed $4.7 million of revenue to the Company’s total revenue for the three months ended June 30, 2025, or a decrease of $5.7 million compared to $10.4 million of revenue reported during the three months ended June 30, 2024. The decrease in revenues was primarily due to lower average realized sales price received of $27.35 per Boe during the three months ended June 30, 2025 compared to the $41.68 per Boe received during the same period in 2024. Sales volumes in Canada decreased during the three months ended June 30, 2025 to 172 MBoe in comparison to 249 MBoe in the same period in 2024.

Previous wording

Derivative instruments gain (loss), netis attributable to our swaps and collars as discussed in Part I, Item 1, Note 8. Derivatives and Fair Value to the unaudited condensed consolidated financial statements. Derivative loss decreasedby $0.7 million to a loss of $0.1 million for the three months ended March 31, 2025 from a loss of $0.8 million during the same period in 2024. Derivative losses for the three months ended March 31, 2025 are a result of the increase in the price of Dated Brent crude oil over the initial strike price per barrel of the option over the three months ended March 31, 2025. Our derivative instruments currently cover a portion of our production through September 2025 for oil and through October 2025 for gas.

Current wording

Derivative instruments gain (loss), netis attributable to our swaps and collars as discussed in Part I, Item 1, Note 8. Derivatives and Fair Value to the unaudited condensed consolidated financial statements. Derivative gain increasedby $0.1 million to a gain of $0.4 million for the three months ended June 30, 2025 from a gain of $0.3 million during the same period in 2024. Derivative gains for the three months ended June 30, 2025 are a result of the decrease in the price of Dated Brent crude oil over the initial strike price per barrel of the option over the three months ended June 30, 2025. Our derivative instruments currently cover a portion of our production through July 2026 for oil and through March 2026 for natural gas.

Previous wording

Interest expense, netwas $1.3 million for the three months ended March 31, 2025 compared to an expense of $0.9 million during the same period in 2024. The increase of net interest expense for the three months ended March 31, 2025 primarily results from an increase in our amortization of debt issue costs and commitment fees incurred on the 2025 RBL Facility partially offset by interest income.

Current wording

Interest expense, netwas $2.6 million for the three months ended June 30, 2025 compared to an expense of $1.1 million during the same period in 2024. The increase in net interest expense for the three months ended June 30, 2025 primarily resulted from an increase in our amortization of debt issue costs, commitment fees incurred and interest incurred on our borrowing under the 2025 RBL Facility, partially offset by interest income.

Previous wording

Other income (expense), netincreased by $0.5 million to an expense of $1.0 million for the three months ended March 31, 2025 from a $0.5 million expense during the same period in 2024. Other income (expense), net, normally consists of foreign currency gains and losses.

Current wording

Other income (expense), netdecreased by $2.3 million to an income of $0.4 million for the three months ended June 30, 2025 from a $2.0 million expense during the same period in 2024. Other income (expense), net, normally consists primarily of foreign currency gains and losses. However, during the three months ended June 30, 2024, there was a $1.7 million expense related to transactions costs associated with the Svenska acquisition.

Previous wording

Income tax expense (benefit) for the three months ended March 31, 2025 was an expense of $16.1 million which includes a $0.7 million unfavorable oil price adjustment as a result of the change in value of the government of Gabon's allocation of Profit Oil between the time it was produced and the time it was taken in-kind. After excluding this impact, income taxes were $15.4 million for the period. Income tax expense for the three months ended March 31, 2024 was an expense of $22.2 million, this is comprised of current tax expense of $25.7 million including a $1.6 million adverse oil price adjustment as a result of the change in value of the government of Gabon's allocation of Profit Oil between the time it was produced and the time it was taken in-kind. After excluding this impact, current income taxes were $24.1 million for the period.

Current wording

Income tax expense (benefit) for the three months ended June 30, 2025 was an expense of $7.0 million which includes a $3.1 million favorable oil price adjustment as a result of the change in value of the government of Gabon's allocation of Profit Oil between the time it was produced and the time it was taken in-kind. After excluding this impact, income taxes were $10.1 million for the period. Income tax expense for the three months ended June 30, 2024 was an expense of $9.3 million. This expense is comprised of current tax expense of $10.4 million including a $1.1 million favorable oil price adjustment as a result of the change in value of the government of Gabon's allocation of Profit Oil between the time it was produced and the time it was taken in-kind. After excluding this impact, current income taxes were $10.4 million for the period.

Previous wording

Crude oil sales in Côte d’Ivoire are sold through a marketing contract with an international oil trading company which offers the cargo shipments to buyers, mainly refineries, around the world. The Company's Côte d’Ivoire segment contributed $18.0 million of revenue to the Company’s total revenue during the three months ended March 31, 2025. Total sales volumes in Côte d'Ivoire for the three months ended March 31, 2025 was 238 MBbls and the average realized sales price received was $75.87 per barrel. The assets in Cote d’Ivoire were acquired through the Svenska Acquisition which was completed in April 2024 and as such, there is not a comparable amount in the same period of 2024. See Part I, Item 1,

Current wording

Crude oil sales in Côte d’Ivoire are sold through a marketing contract with an international oil trading company which offers the cargo shipments to buyers, mainly refineries, around the world. The Company's Côte d’Ivoire segment contributed $18.4 million of revenue to the Company’s total revenue for the six months ended June 30, 2025, or an increase of $1.2 million, compared to $17.2 million of revenue reported during the six months ended June 30, 2024. The increase in revenues was primarily due to an increase in sales volumes from 211 MBbls during six months ended June 30, 2024 to 238 MBbls during the same period in 2025. The increase in sales volumes is offset by lower average realized sales price received of $77.36 per Boe during the six months ended June 30, 2025 compared to $81.59 per Boe received during the same period in 2024.

Previous wording

Production expenses increased $12.7 million, or approximately 40%, for the three months ended March 31, 2025 to $44.8 million from $32.1 million for the same period in the prior year. The increase was primarily driven by higher expenses in Gabon related to government audit settlements of approximately $4.7 million (net to Vaalco), additional chemical costs associated with the H 2 S treatment and to the increased sales associated with the purchase of the Côte d'Ivoire asset. On a per barrel basis, production expense, excluding workover expense and stock compensation expense, for the three months ended March 31, 2025 increased to $26.05 per barrel from $21.56 per barrel for the three months ended March 31, 2024.

Current wording

Production expenses increased $0.7 million for the six months ended June 30, 2025 to $85.2 million from $84.5 million for the same period in the prior year. The increase was primarily driven by higher expenses in Gabon which includes customs costs of approximately $4.7 million and increased maintenance costs to enhance well productivity partially offset by a decrease in expenses in the Cote d’Ivoire segment. On a per barrel basis, production expense, excluding workover expense and stock compensation expense, for the six months ended June 30, 2025 decreased to $24.43 per barrel from $25.96 per barrel for the six months ended June 30, 2024.

Previous wording

Depreciation, depletion and amortization costs increased $4.5 million, or approximately 17%, for the three months ended March 31, 2025 to $30.3 million from $25.8 million during the same period in 2024. The increase in depreciation, depletion and amortization expense is primarily related to the Svenska Acquisition partially offset by lower depletable costs in Gabon and Egypt.

Current wording

Depreciation, depletion and amortization costs decreased $0.4 million, or approximately 1%, for the six months ended June 30, 2025 to $58.6 million from $59.0 million during the same period in 2024. The decrease in depreciation, depletion and amortization expense is primarily related to the lower depletable costs in Gabon and Egypt.

Previous wording

General and administrative expenses slightly increased $1.0 million, or 13%, for the three months ended March 31, 2025 to $9.1 million from $8.0 million during the same period in 2024. The increase in general and administrative expenses is primarily due to an increase inprofessional service fees, salaries and wages, and accounting and legal fees.

Current wording

General and administrative expenses slightly increased $3.2 million, or 23%, for the six months ended June 30, 2025 to $17.5 million from $14.3 million during the same period in 2024. The increase in general and administrative expenses is primarily due to an increase inprofessional service fees, salaries and wages, and accounting and legal fees.

Previous wording

Credit losses and other decreased by approximately $1.8 million during the three months ended March 31, 2025 compared to the same period in 2024. The decrease in credit losses and other for the three months ended March 31, 2025, is primarily attributable to the higher allowance calculated during the first quarter of 2024 related to the Backdated Receivables, defined in Part I, Item 1, Note 10. Commitments and Contingencies to the unaudited condensed consolidated financial statements. The Backdated Receivables were settled as of March 31, 2025.

Current wording

Credit losses and other decreased by approximately $5.2 million during the six months ended June 30, 2025 compared to the same period in 2024. The decrease in credit losses and other for the six months ended June 30, 2025, is primarily attributable to the higher allowance calculated during the first six months of 2024 related to the Backdated Receivables, defined in Part I, Item 1, Note 10. Commitments and Contingencies to the unaudited condensed consolidated financial statements. The Backdated Receivables were settled as of March 31, 2025.