VAALCO Energy Provides Update on Gabon Drilling Program

Thursday, Mar 11, 2010

VAALCO Energy, Inc. is pleased to announce that the contracted rig "Sapphire Driller" is on location at the Ebouri Platform offshore Gabon and will commence drilling the first of four wells today, March 10, 2010.

The following four wells, in order, are scheduled to be drilled:

  -- Ebouri 4H   Horizontal development well in the Ebouri Field to
     ---------   establish additional production while testing a deeper horizon and potential future development locations. Estimated drilling time of six weeks at a gross cost of approximately $25.4 million.  Initial production estimated at 4,000 barrels per day gross.

  -- Ebouri 3H   Horizontal workover to replace two electrical submersible
     ---------   pumps and return well to optimal production of approximately 3,000 gross barrels per day.  Three weeks drill time at a gross cost of approximately $5.4 million.

  -- SE Etame    Move rig approximately 14 kms to drill an exploration
     --------    well to evaluate the Gamba and the deeper Dentale sandstones.  Estimated drilling time of five weeks with a gross cost of $13.8 million.  Potential gross reserves of 27 million barrels.

  -- Etame 7H    Horizontal development well in known separate fault block

--------    in Etame Field to add additional production of approximately 4,000 gross barrels per day.  Estimated drilling time including installation of sub-sea tree is approximately eight weeks at a gross cost of $44.0 million.

The Company's subsidiary VAALCO Gabon Etame, Inc. operates and owns a 28.07% net interest in the Etame Field. Other field partners are Addax Petroleum Etame Inc. (31.36%), Sasol Petroleum Etame Limited (27.75%), Sojitz Etame Limited (2.98%), PetroEnergy Resources Corp. (2.34%) and Tullow Oil Gabon SA (7.5%).

Source: PR Newswire