VAALCO Energy today provided an operational update including additional information on the North Tchibala 2H-ST well.

Highlights

• In Gabon, the North Tchibala 2H-ST well was brought online in early November and flowed at a low, controlled rate to allow for cleanup and to minimize negative impact to the completion;
• Through early December, the well has flowed, but with temporary interruptions for operational activity and shut-ins for pressure build up analysis with the following results:
  • Produced approximately 8,000 gross barrels of oil, or about 275 gross barrels of oil per day (“BOPD”);
  • Recovered about 33% of injected completion fluid;
  • Cleanup is continuing and pressure transient analysis indicates the lower stimulated zones may not be contributing;
  • Conducting chemical analysis on oil recovered from the well that will help determine if all zones that were fracture stimulated are producing;

• Post-frac modeling suggests that the well is capable of producing rates at or above 1,500 gross BOPD;
• On December 4th, the first lifting from the new FSO “TELI” was successfully completed at the same time that the final remaining volumes from the Nautipa FPSO were removed;
• In Egypt, VAALCO expects to spud the first horizontal well on December 12th, with completion operations planned for first quarter 2023;
• In Canada, the tie in of the 4-10 well is expected in late December with an expected flow rate of about 200 barrels of oil equivalent per day before year end; and
• Also in Canada, construction on the 14-25-29-04W5 surface lease has been completed with drilling expected to start in early January 2023.

George Maxwell, Chief Executive Officer, commented,
“We continue to monitor the fluids flowing from the North Tchibala 2H-ST well to better understand its results. During cleanup, the well has been producing about 275 gross BOPD, however our post-frac modeling indicates that the well is capable of producing rates in excess of 1,500 gross BOPD. The well is not cleaning up as expected, with only about 33% of completion fluid recovered. We are continuing to gather information to understand why the lower stimulated zones may not yet be contributing any meaningful production. We will continue to monitor the well and plan to provide additional information to the market once we have analyzed all the data.

We are continuing to integrate the TransGlobe team and assets into our strategic vision and with no debt and strong free cash flow generation, we remain confident that VAALCO will be able to deliver meaningful value to our shareholders.”

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