Vaalco Energy, Inc. · NYSE:EGY
Vaalco Energy — Q3 2015 Earnings Presentation
19 slides from Vaalco Energy's earnings presentation, Nov 10, 2015
Slide 1: Third Quarter 2015 Supplemental Information
NYSE:EGY VAALCO ENERGY, INC Third Quarter 2015 Supplemental Information
Slide 2: Safe Harbor Statement
2 Safe Harbor Statement VAALCO ENERGY, INC This document includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are those concerning VAALCO's pla
Slide 3: Important Additional Information
Important Additional Information .In connection with the consent solicitation initiated by the Group 42-BLR Group, the Company may file a consent revocation statement and other documents regarding the proposals of the Group 42-BLR Group with the SEC and may mail a consent revocation statement and a
Slide 4: Third Quarter and Recent Highlights
Third Quarter and Recent Highlights.Grew total production 6% from 2Q 2015 to approximately 4,800 BOE per day, above the high end of 3Q 2015 guidance of 4,400 – 4,700 BOE per day .Successfully drilled and completed the North Tchibala 1-H well at a rate of 3,000 BOPD (750 Net), representing the first
Slide 5: Net Base and Development Production
NYSE:EGY Net Base and Development Production 4,714 4,178 3,883 3,453 1,100 4,714 4,178 3,883 4,553 0 1,000 2 ,000 3,000 4,000 5,000 6,000 2012 2013 2014 2015YTD Q4 2015E Net BOE per day Base Production Development Drilling Increment Total 4 (1)Midpoint of guidance range (1) ~4,800 ~1,800 ~3,000 Deve
Slide 6: Offshore Gabon Net Liftings
NYSE:EGY Offshore Gabon Net Liftings 0 100,000 200,000 300,000 400,000 500,000 600,000 Q12013 Q22013 Q32013 Q42013 Q12014 Q22014 Q32014 Q42014 Q12015 Q22015 Q32015 Q42015E Net BO 2013 Lifting Average 390,000 2014 Lifting Average 340,000 2015E Lifting Average ~420,000 5 (2) (1)Forecasted Q4 2015 lift
Slide 7: 2015 Cost Reduction Initiatives Net Production Expense
2015 Cost Reduction Initiatives Net Production Expense .Sustainable reductions driven by work efficiencies •Helicopter Usage Reduction $1.1 million •Marine Vessel Reduction $0.4 million •Chemical programs $0.8 million .Reductions in service and materials costs .Workforce Realignment $0.8 million .Ma
Slide 8: Net Production Expenses
Net Production Expenses 7 10.1 8.5 8.9 7.9 $27.43 $22.50 $19.08 $19.36 $- $5.00 $10.00 $15.00 $20.00 $25.00 $30.00 0.0 2.0 4.0 6.0 8.0 10.0 12.0 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015E $/BOE of sales $MM Production Expense $/BOE (2) (1) $16.50 $18.50 7.5- 8.5 Cost Reduction Initiatives Contributing
Slide 9: 2015 Cost Reduction Initiatives Net General & Administrative Expense
8 2015 Cost Reduction Initiatives Net General & Administrative Expense .Staffing and administrative cost reductions .30% reduction in executive/management cash compensation .15% reduction in corporate staff .Reduction in contract, 3rd party services and travel costs .2016 savings of ~$3 million due
Slide 10: Net G&A Expense and Adjusted EBITDAX per BOE
Net General & Administrative Expense Cost Reductions & Development Production Growth Contributing to EBITDAX per BOE Despite Fall in Q3 2015 Realizations Adjusted EBITDAX(1) per BOE of Sales 9 (1)Non-GAAP reconciliations located in Appendix, excludes Gabonese income taxes paid as a share of profit o
Slide 11: New SEENT Platform and Development Wells
10 New SEENT Platform .4 pile, 8 slot platform in water depth of 85 meters .Targeting 7 MMBO gross 2P reserves .Transocean “Constellation II” jackup rig .SE Etame 2H .Gamba development well online in July 2015 .Initial rate of 3,400 BOPD gross (900 net) .No water or H2S .North Tchibala 1H .Dentale d
Slide 12: Dentale Potential Across VAALCO Acreage
11 Dentale Potential Across VAALCO Acreage Etame Field Main Fault Block North Tchibala South Tchibala Dentale Potential
Slide 13: Avouma and South Tchibala Fields
12 Avouma Platform Avouma and South Tchibala Fields Export Pipeline Avouma and South Tchibala Fields Discovery well completed August 2004 .Production commenced in January 2007 Two planned 4Q 2015 workovers to replace failed ESPs in wells currently not producing .Avouma 3-H .South Tchibala 2-H .Econo
Slide 14: 2016 Possible Scenarios
13 Additional Etame Drilling Production(2): 5,000 – 5,400 BOEPD Capital(3): $28mm - $33mm Wells Drilled: 2 Minimal Etame Drilling Production(2): 4,700 – 5,000 BOEPD Capital(3): $20mm - $26mm Wells Drilled: 1 No Etame Drilling Production(2): 4,400 – 4,700 BOEPD Capital(3): $14mm - $16mm Wells Drilled
Slide 15: Q4 2015 Guidance
14 Production (BOEPD) 4,400 – 4,700* *4th Quarter Guidance 4,600 – 5,000 Production Expense(1) $33.0 - $34.0 MM* ($19.00 - $20.00 per BOE) *4th Quarter Guidance $7.5 MM - $8.5 MM ($16.50 - $18.50 per BOE) Workovers $6.0 - $9.0 MM* *3 Planned 4th Quarter Workovers Total G&A $15.0 - $16.0 MM Cash G&A
Slide 16: Appendix
NYSE:EGY Appendix
Slide 17: Strong Financial Position
16 Strong Financial Position ($’s in millions) Liquidity 9/30/2015 Cash Balance (Includes $17MM Restricted) $ 58 Current Undrawn IFC Facility 50 Total Liquidity (Before Working Capital Adjustments) 108 3Q 2015 Financial Performance Revenues 18 Operating Income (loss) (32) Tax Expense (3) Non-Cash Im
Slide 18: Non-GAAP Measures
17 Non-GAAP Measures Adjusted EBITDAX is a supplemental non-GAAP financial measure used by VAALCO’s management and by external users of the Company’s financial statements, such as industry analysts, lenders, rating agencies, investors and others who follow the industry as an indicator of the Company
Slide 19: Non-GAAP Reconciliations
18 Non-GAAP Reconciliations Three Months Ended September 30, 2015 September 30, 2014 June 30, 2015 Net income (loss) $ (33,668) 5,204) Add back: Interest income (expense), net 462 (19) 339 Income tax expense 2,707 3,761 4,273 Depreciation, depletion and amortization 8,259 4,289 9,299 Impairment of p