Vaalco Energy (NYSE: EGY): Kossipo shines - resources and WI increased. Potential reserves booking by YE26
• New seismic over Kossipo in Côte d’Ivoire has further de‑risked the structure, increasing gross 2C resources from ~90 mmboe to ~102 mmboe.• With Canadian Natural Resources choosing not to participate in the development as it refocuses on Canada, VAALCO’s working interest rises from 27.39% to 60%, with PetroCI holding the balance as a paying partner.
• This shift is highly material: VAALCO gains ~37 mmboe of additional WI 2C resources, becomes operator, and will control the development timeline. An FDP is planned for 2H26, which could allow reserves booking. At the 2Q25 CMD, first oil was guided for 2030 with ~12 mboe/d net to VAALCO at 27.39% WI; at 60% WI, the project could deliver more than 24 mboe/d net at plateau.
• The Baobab FPSO is now offshore East Africa and expected to reach Côte d’Ivoire in late March, keeping the 2Q26 restart on track. Strong oil prices and timely FPSO delivery de‑risk the redevelopment.
• While the investment case remains anchored in a fully funded doubling of production alongside a robust dividend (~5% yield), the enlarged Kossipo resource base adds meaningful depth and long‑term value to the portfolio.
• Incorporating the higher Kossipo resources, our target price increases from US$10 to US$11.5 per share. Côte d’Ivoire is now VAALCO’s most significant asset base.
Drilling in Gabon
The 15‑HT‑ST development well has been brought online at a gross rate of 2 mbbl/d, and VAALCO is now drilling the Etame West exploration well, which targets 2.3 mmbbl of prospective resources (WI). Results are expected in March, with a 57% chance of success. On an unrisked basis, the well contributes US$0.18 per share to our NAV.
Valuation
We have changed our ReNAV from US$9.54 per share to US$11.63 per share. We carry a 60% chance of development for Kossipo with an unrisked NAV of US$4.95 per share.
VAALCO Energy is an independent energy company engaged in the acquisition, exploration, development and production of crude oil. The company is primarily engaged in its Etame Production Sharing Contract related to the Etame Marin block located offshore the Republic of Gabon in West Africa. The company also owns interests in an undeveloped block offshore Equatorial Guinea, West Africa.
Auctus Advisors is a specialist Equity Capital Markets and Advisory business with a focus in the Energy Sector.
The partners have complementary skill sets, with decades of experience across Equity Capital Markets, Investment Banking and the Energy industry. We have worked at Société Générale, Canaccord Capital, BMO Capital Markets and Schlumberger. Most recently we have worked together for many years at GMP FirstEnergy.
Auctus has been set up at the beginning of a new decade in which we see significant opportunities in the Energy space. Globally, demand for energy is at record levels and continues to grow. Conversely, investment in traditional energy sources has been severely constrained. We believe this imbalance creates opportunities for both companies and investors.
Auctus provides Corporate Broking, Equity Research and Investment Banking services.
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