VAALCO Energy Inc. (NYSE: EGY) has received written confirmation from the Ministry of Petroleum of Angola that the available 40% working interest in Block 5, offshore Angola, has been assigned to Sonangol EP, and that Sonangol EP will assign the aforementioned participating interest to its exploration and production affiliate, Sonangol P&P. With this confirmation, VAALCO has begun the process of contacting drilling rig companies to secure a semi-submersible rig to begin the exploration phase of the pre-salt/post-salt Kwanza Basin program.
Steve Guidry, CEO, commented, "We are excited to begin drilling offshore Angola, especially given the recent significant discoveries made elsewhere in the Kwanza basin in which Block 5 is located. Having Sonangol as our partner, with their extensive knowledge of the basin, reaffirms our confidence in the potential of discovering commercial quantities of hydrocarbons on our 1.4 million-acre concession."
Following the assignment, Sonangol and its affiliates will hold a 60% working interest in Block 5, comprising a 20% carried working interest and the newly assigned 40% participatory working interest. VAALCO, as operator, continues to hold a 40% operating working interest in Block 5.