June 19, 2008

Vaalco Resumes Production at Offshore Gabon Fields After FPSO Upgrade

Vaalco Energy has announced that production at its Etame and Avouma-Tchibala fields offshore Gabon, has successfully been restored following the transfer of equipment to upgrade the floating production, storage and offloading facility.

As previously announced, the floating production, storage and offloading (FPSO) upgrade is intended to improve water processing capacity at the facility, enabling Vaalco to increase production by 10% to 25,000 barrels of oil per day (bpd) by 2008 year-end.

Vaalco also announced that the barge carrying its platform for the Ebouri field has arrived in Gabon. Plans call for the platform to be tied back via a pipeline to the FPSO facility that also serves Vaalco's Etame and Avouma-Tchibala fields.

Upon completion of the construction for the production pipeline, Vaalco will begin installing the platform. The drilling rig is expected to arrive in October 2008.

Vaalco said that it remains on schedule to commence drilling the Ebouri development with oil production expected in December 2008 at an initial rate of 4,000-6,000 bpd.

Robert Gerry III, chairman and CEO, said: "The equipment exchange from the transportation vessel onto the FPSO went flawlessly, and we were able to restart our fields in less than two days."