Vaalco Energy’s FY 2025: production beats, loss booked, big 2026 spend lined up
Vaalco Energy has posted its fourth quarter and full year 2025 numbers. The headline mix: stronger-than-guided production and sales, a statutory net loss driven by a non-cash Canadian impairment, robust operating cash flow, and a punchy 2026 capital programme aimed at Gabon and Côte d’Ivoire. There’s real operational momentum here, but also some execution and funding watch-outs.
Key numbers at a glance
| Metric | FY 2025 |
|---|---|
| NRI sales volumes | 17,452 BOEPD |
| NRI production | 16,556 BOEPD |
| WI production | 21,160 BOEPD |
| Net income (loss) | $(41.4) million ( $(0.40) per share ) |
| Adjusted Net Loss | $(4.0) million ( $(0.04) per share ) |
| Adjusted EBITDAX | $173.4 million |
| Net cash from operating activities | $212.7 million |
| SEC proved reserves (YE 2025) | 43.0 MMBOE |
| 2P WI CPR reserves (YE 2025) | 90.7 MMBOE; PV-10 $858.8 million |
| Cash (YE 2025) | $58.9 million |
| Net debt (YE 2025) | ~$1.1 million |
| Cash returned to shareholders (2025) | $26.5 million dividends |
Quick jargon check: NRI is net revenue interest – volumes after royalties. WI is working interest – gross to Vaalco before royalties. EBITDAX is earnings before interest, tax, depreciation, amortisation and exploration – a cash proxy many oil companies use.
What drove the loss despite healthy cash flow?
Q4 2025 is the culprit. Vaalco booked a non-cash impairment of $67.2 million on Canadian assets that were subsequently sold for $25.5 million on 19 February 2026. That swung the quarter to a net loss of $58.6 million, taking the full year to a $41.4 million loss.
Strip out the non-cash and one-off items, and the engine room looked solid: Adjusted EBITDAX came in at $173.4 million and operating cash flow at $212.7 million despite softer oil prices – the average realised price fell to $56.11/BOE from $65.64/BOE in 2024. Lower Côte d’Ivoire volumes during the Baobab FPSO dry-dock also weighed on year-on-year comparisons.
Operations: steady delivery and catalysts lining up
Gabon – drilling success and more to come
Phase Three at Etame kicked off in Q4 2025. The Etame 15H-ST development well was drilled in December and put on production in January 2026, meeting expectations from its pilot. The West Etame ET-14P exploration result was water-bearing in the Gamba sands, but Vaalco is reusing the wellbore to side-track into the ET-14H development in the Main Fault Block, with completion expected in April. The rig then heads to SEENT and Ebouri for further wells and workovers to lift volumes and potentially add reserves.
Côte d’Ivoire – Baobab restart and Kossipo operator status
The Baobab FPSO refurbishment finished in February 2026 and is expected back offshore Côte d’Ivoire by late March, with the field due to restart in Q2 2026. A development drilling programme is slated to begin in Q4 2026 and is expected to deliver “meaningful additions” to production.
Strategically, Vaalco was confirmed as operator with a 60% working interest in the Kossipo field on CI-40. An FDP is targeted for the second half of 2026. The 2019 Kossipo-2A appraisal tested at over 7,000 BOPD, and recent ocean bottom node seismic is being used to refine plans. Separately, Vaalco acquired 70% WI in the CI-705 block in 2025, building out a Côte d’Ivoire growth corridor.
Egypt – drilling campaign completed and receivables progress
The 2025 drilling programme wrapped up in Q4 with four development wells in the Eastern Desert (three completed in Q4, the fourth in January 2026). An H-Field exploration success opened a new development area with an initial c.450 BOEPD. Continuous workovers and optimisation supported volumes.
Importantly for cash, Egyptian receivables were reduced from $113 million at the start of 2025 to $31 million by year end, even after invoicing over $129 million during the year. Management says aged receivables are now largely current.
Q4 snapshot: strong sales, heavy spend
Q4 2025 NRI sales averaged 18,566 BOEPD, 10% above the high end of guidance, with Adjusted EBITDAX of $42.9 million. Capex was a chunky $100.1 million as Vaalco pushed Gabon drilling, advanced Côte d’Ivoire FPSO works and secured long-lead items for 2026 campaigns.
| Q4 2025 highlights | Value |
|---|---|
| NRI production | 16,128 BOEPD |
| Adjusted EBITDAX | $42.9 million |
| Net income (loss) | $(58.6) million |
| Production expense per BOE | $25.21 |
| Realised price per BOE (NRI) | $52.54 |
Reserves: stable base with positive revisions
SEC proved reserves ended 2025 at 43.0 MMBOE, down 5% after producing 6.0 MMBOE, but helped by 4.0 MMBOE of positive revisions, extensions and additions. The standardised measure rose to $410.0 million from $379.4 million. On a WI CPR basis, 2P reserves stand at 90.7 MMBOE with a PV-10 of $858.8 million, up 26% year on year.
Balance sheet, liquidity and hedging
Year-end cash was $58.9 million with $60.0 million drawn on the reserves based lending facility, leaving net debt of around $1.1 million. The working capital position flipped to a $59.0 million deficit (Adjusted Working Capital deficit of $41.2 million) as the company accelerated spend into Q4.
Since year end, Vaalco borrowed an additional $65.0 million in February 2026 under the RBL at 10.2% interest, due within a month with an option to roll. The RBL commitments were increased to $255.0 million with an accordion up to $300.0 million. Hedging has been layered in: about 2.9 million barrels of 2026 oil hedged at an average floor of roughly $64/bbl, plus c.700 thousand barrels in early 2027 with a $65/bbl floor.
2026 plan: big capex and clear catalysts
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