0001193125-13-327095.txt : 20130808 0001193125-13-327095.hdr.sgml : 20130808 20130808170050 ACCESSION NUMBER: 0001193125-13-327095 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 11 CONFORMED PERIOD OF REPORT: 20130630 FILED AS OF DATE: 20130808 DATE AS OF CHANGE: 20130808 FILER: COMPANY DATA: COMPANY CONFORMED NAME: VAALCO ENERGY INC /DE/ CENTRAL INDEX KEY: 0000894627 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 760274813 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-32167 FILM NUMBER: 131022989 BUSINESS ADDRESS: STREET 1: 4600 POST OAK PL STE 309 CITY: HOUSTON STATE: TX ZIP: 77027 BUSINESS PHONE: 713-623-0801 MAIL ADDRESS: STREET 1: 4600 POST OAK PL STE 309 CITY: HOUSTON STATE: TX ZIP: 77027 10-Q 1 d553407d10q.htm FORM 10-Q Form 10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 10-Q

 

 

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2013

 

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 1-32167

 

 

VAALCO Energy, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   76-0274813

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

4600 Post Oak Place

Suite 300

Houston, Texas

  77027
(Address of principal executive offices)   (Zip code)

(713) 623-0801

(Registrant’s telephone number, including area code)

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ¨    No  ¨.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer   ¨    Accelerated filer   x
Non-accelerated filer   ¨    Smaller reporting company   ¨

Indicate by a check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2).    Yes  ¨    No  x.

As of July 31, 2013, there were outstanding 56,662,294 shares of common stock, $0.10 par value per share, of the registrant.

 

 

 


Table of Contents

VAALCO ENERGY, INC. AND SUBSIDIARIES

Table of Contents

 

PART I. FINANCIAL INFORMATION

  

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

  

Condensed Consolidated Balance Sheets
June 30, 2013 and December 31, 2012

     3   

Condensed Statements of Consolidated Operations
Three months and Six months ended June 30, 2013 and 2012

     4   

Condensed Consolidated Statements of Changes in Equity
Six months ended June 30, 2013 and 2012

     5   

Condensed Statements of Consolidated Cash Flows
Six months ended June 30, 2013 and 2012

     6   

Notes to Unaudited Condensed Consolidated Financial Statements

     7   

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     13   

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     26   

CONTROLS AND PROCEDURES

     26   

PART II. OTHER INFORMATION

     27   

ITEM 1A. RISK FACTORS

     27   

ITEM 6. EXHIBITS

     27   

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in thousands of dollars, except number of shares and par value amounts)

 

     June 30,     December 31,  
     2013     2012  

ASSETS

    

Current assets:

    

Cash and cash equivalents

   $ 78,708      $ 130,800   

Restricted cash

     1,770        1,257   

Receivables:

    

Trade

     26,227        7,961   

Accounts with partners, net of allowance of $7.2 million and $6.0 million at June 30, 2013 and December 31, 2012, respectively

     4,821        689   

Other

     7,688        4,463   

Crude oil inventory

     3,328        683   

Materials and supplies

     642        337   

Prepayments and other

     4,099        2,935   
  

 

 

   

 

 

 

Total current assets

     127,283        149,125   
  

 

 

   

 

 

 

Property and equipment - successful efforts method:

    

Wells, platforms and other production facilities

     198,571        188,208   

Undeveloped acreage

     28,410        28,657   

Work in progress

     61,929        38,137   

Equipment and other

     7,221        7,574   
  

 

 

   

 

 

 
     296,131        262,576   

Accumulated depreciation, depletion and amortization

     (163,411     (155,968
  

 

 

   

 

 

 

Net property and equipment

     132,720        106,608   
  

 

 

   

 

 

 

Other assets:

    

Deferred tax asset

     1,349        1,349   

Restricted cash

     10,871        10,874   
  

 

 

   

 

 

 

Total Assets

   $ 272,223      $ 267,956   
  

 

 

   

 

 

 

LIABILITIES AND EQUITY

    

Current liabilities:

    

Accounts payable and accrued liabilities

   $ 33,219      $ 30,326   

Accounts with partners

     —          14,737   
  

 

 

   

 

 

 

Total current liabilities

     33,219        45,063   
  

 

 

   

 

 

 

Asset retirement obligations

     11,135        10,368   
  

 

 

   

 

 

 

Total Liabilities

     44,354        55,431   
  

 

 

   

 

 

 

Commitments and Contingencies (Note 4)

    

VAALCO Energy, Inc. shareholders’ equity:

    

Common stock, $0.10 par value, 100,000,000 authorized shares, 63,167,438 and 63,135,772 shares issued with 5,491,038 and 5,257,638 shares in treasury at June 30, 2013 and December 31, 2012, respectively

     6,317        6,314   

Additional paid-in capital

     51,186        48,816   

Retained earnings

     195,680        181,370   

Less treasury stock, at cost

     (25,314     (23,975
  

 

 

   

 

 

 

Total VAALCO Energy, Inc. shareholders’ equity

     227,869        212,525   
  

 

 

   

 

 

 

Total Liabilities and Equity

   $ 272,223      $ 267,956   
  

 

 

   

 

 

 

See notes to unaudited condensed consolidated financial statements.

 

3


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VAALCO ENERGY, INC. AND SUBSIDIARIES

CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS

(unaudited)

(in thousands of dollars, except per share amounts)

 

     Three months ended
June 30,
    Six months ended
June 30,
 
     2013     2012     2013     2012  

Revenues:

        

Oil and gas sales

   $ 29,118      $ 58,818      $ 73,255      $ 104,104   

Operating costs and expenses:

        

Production expenses

     7,015        6,537        15,399        12,063   

Exploration expense

     4,280        3,484        10,386        4,337   

Depreciation, depletion and amortization

     3,431        6,850        7,057        11,854   

General and administrative expenses

     2,464        3,040        6,102        6,521   

Bad debt expenses

     262        275        1,141        590   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating costs and expenses

     17,452        20,186        40,085        35,365   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     11,666        38,632        33,170        68,739   

Other income (expense):

        

Interest income

     16        32        41        73   

Other, net

     (2     382        (96     583   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other income (expense)

     14        414        (55     656   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes

     11,680        39,046        33,115        69,395   

Income tax expense

     4,559        26,729        18,805        46,549   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

     7,121        12,317        14,310        22,846   

Less net income attributable to noncontrolling interest

     —          (1,893     —          (3,402
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income attributable to VAALCO Energy, Inc.

   $ 7,121      $ 10,424      $ 14,310      $ 19,444   
  

 

 

   

 

 

   

 

 

   

 

 

 

Basic net income attributable to VAALCO Energy, Inc. common shareholders

   $ 0.12      $ 0.18      $ 0.25      $ 0.34   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted net income attributable to VAALCO Energy, Inc. common shareholders

   $ 0.12      $ 0.18      $ 0.24      $ 0.33   
  

 

 

   

 

 

   

 

 

   

 

 

 

Basic weighted shares outstanding

     57,901        57,797        57,904        57,496   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted weighted shares outstanding

     58,560        59,000        58,786        58,701   
  

 

 

   

 

 

   

 

 

   

 

 

 

See notes to unaudited condensed consolidated financial statements.

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(unaudited)

(in thousands of dollars)

 

     VAALCO Energy, Inc. Shareholders              

Six Months Ended June 30, 2013

   Common
Stock
     Aditional
Paid-In Capital
     Retained
Earnings
     Treasury
Stock
    Noncontrolling
Interest
    Total  

Balance at January 1, 2013

   $ 6,314       $ 48,816       $ 181,370       $ (23,975   $ —        $ 212,525   

Proceeds from stock issuance

     3         132         —           —          —          135   

Stock based compensation

     —           2,238         —           —          —          2,238   

Treasury stock purchase

              (1,339       (1,339

Net income

     —           —           14,310         —          —          14,310   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

Balance at June 30, 2013

   $ 6,317       $ 51,186       $ 195,680       $ (25,314   $ —        $ 227,869   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 
     VAALCO Energy, Inc. Shareholders              

Six Months Ended June 30, 2012

   Common
Stock
     Aditional
Paid-In Capital
     Retained
Earnings
     Treasury
Stock
    Noncontrolling
Interest
    Total  

Balance at January 1, 2012

   $ 6,238       $ 66,122       $ 180,739       $ (23,975   $ 3,943      $ 233,067   

Proceeds from stock issuance

     72         3,297         —           —          —          3,369   

Stock based compensation

     —           1,704         —           —          —          1,704   

Net income

     —           —           19,444         —          3,402        22,846   

Distribution to noncontrolling interest

     —           —           —           —          (3,597     (3,597
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

Balance at June 30, 2012

   $ 6,310       $ 71,123       $ 200,183       $ (23,975   $ 3,748      $ 257,389   
  

 

 

    

 

 

    

 

 

    

 

 

   

 

 

   

 

 

 

See notes to unaudited condensed consolidated financial statements.

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS

(Unaudited)

(in thousands of dollars)

 

     Six Months Ended
June 30,
 
     2013     2012  

CASH FLOWS FROM OPERATING ACTIVITIES

  

Net income

   $ 14,310      $ 22,846   

Adjustments to reconcile net income to net cash provided by operating activities

    

Depreciation, depletion and amortization

     7,057        11,854   

Unrealized foreign exchange loss (gain)

     22        (358

Dry hole costs

     8,836        2,853   

Stock based compensation

     2,238        1,704   

Bad debt expense

     1,141        590   

Change in operating assets and liabilities:

    

Trade receivables

     (18,266     (9,904

Accounts with partners

     (20,010     6,077   

Other receivables

     (3,306     (1,061

Crude oil inventory

     (1,944     (437

Materials and supplies

     (305     (180

Prepayments and other

     (1,166     (1,594

Accounts payable, accrued liabilities and other liabilities

     1,848        (4,372
  

 

 

   

 

 

 

Net cash provided by (used in) operating activities

     (9,545     28,018   
  

 

 

   

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

    

Restricted cash, net

     (510     88   

Property and equipment expenditures

     (40,833     (27,221
  

 

 

   

 

 

 

Net cash used in investing activities

     (41,343     (27,133
  

 

 

   

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

    

Proceeds from the issuance of common stock

     135        3,369   

Purchase of treasury stock

     (1,339     —     

Distribution to noncontrolling interest

     —          (3,597
  

 

 

   

 

 

 

Net cash used in financing activities

     (1,204     (228
  

 

 

   

 

 

 

NET CHANGE IN CASH AND CASH EQUIVALENTS

     (52,092     657   

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

     130,800        137,139   
  

 

 

   

 

 

 

CASH AND CASH EQUIVALENTS AT END OF PERIOD

   $ 78,708      $ 137,796   
  

 

 

   

 

 

 

Supplemental disclosure of cash flow information

    

Income taxes paid

   $ 18,416      $ 41,733   

Supplemental disclosure of non cash transactions

    

Property and equipment additions incurred during the period but not paid at period end

   $ 11,238      $ 5,456   

Property and equipment reductions as the result in changes in asset retirement cost estimates

   $ —        $ 5,670   

See notes to unaudited condensed consolidated financial statements.

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND ACCOUNTING POLICIES

The condensed consolidated financial statements of VAALCO Energy, Inc. and subsidiaries (collectively, “VAALCO” or the “Company”), included herein are unaudited, but include all adjustments consisting of normal recurring accruals which the Company deems necessary for a fair presentation of its financial position, results of operations and cash flows for the interim period. Such results are not necessarily indicative of results to be expected for the full year. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Form 10-K for the year ended December 31, 2012, which also contains a summary of the significant accounting policies followed by the Company in the preparation of its consolidated financial statements. These policies were also followed in preparing the quarterly report included herein. The Company follows the successful efforts method of accounting for oil and gas exploration and development costs.

VAALCO is a Houston-based independent energy company, principally engaged in the acquisition, exploration, development and production of crude oil and natural gas. VAALCO owns producing properties and conducts exploration activities as an operator in Gabon, West Africa, conducts exploration activities as an operator in Angola, West Africa, and conducts exploration activities as a non-operator in Equatorial Guinea, West Africa. VAALCO is the operator of unconventional and conventional resource properties in the United States located in Montana and North Texas. The Company also owns minor interests in conventional production activities as a non-operator in the United States.

VAALCO’s international subsidiaries are VAALCO Gabon (Etame), Inc., VAALCO Production (Gabon), Inc., VAALCO Angola (Kwanza), Inc., VAALCO UK (North Sea), Ltd., VAALCO International, Inc., VAALCO Energy (EG), Inc. and VAALCO Energy Mauritius (EG) Limited. VAALCO Energy (USA), Inc. holds interests in properties located in the United States.

 

2. EARNINGS PER SHARE

Basic earnings per share (“EPS”) is calculated using the average number of shares of common stock outstanding during each period. Diluted EPS assumes the exercise of all stock options having exercise prices less than the average market price of the common stock using the treasury stock method.

Diluted shares consist of the following:

 

     Three months ended,      Six months ended,  
     June 30, 2013      June 30, 2012      June 30, 2013      June 30, 2012  

Basic weighted average common stock issued and outstanding

     57,900,809         57,797,484         57,903,871         57,496,261   

Dilutive options

     659,475         1,202,808         881,937         1,204,568   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total dilutive shares

     58,560,284         59,000,292         58,785,808         58,700,829   
  

 

 

    

 

 

    

 

 

    

 

 

 

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

Options to purchase 3,205,865 and 2,135,300 shares were excluded in the three months and six months ended June 30, 2013, respectively, because they would have been anti-dilutive. Options to purchase 1,018,900 and 1,018,900 shares were excluded in the three months and six months ended June 30, 2012, respectively, because they would have been anti-dilutive.

 

3. STOCK-BASED COMPENSATION

Stock options are granted under the Company’s long-term incentive plan and have an exercise price that may not be less than the fair market value of the underlying shares on the date of grant. In general, stock options granted will become exercisable over a period determined by the Compensation Committee which in the past has been a five year life. A portion of the stock options granted in March 2013 and 2012 vested immediately with the remainder vesting over a two year period. In addition, stock options will become exercisable upon a change in control, unless provided otherwise by the Compensation Committee. At June 30, 2013, there were 2,127,046 shares subject to options authorized but not granted.

For the three months and six months ended June 30, 2013, the Company recognized non-cash compensation expense of $0.8 million and $2.2 million, respectively, related to stock options. For the three months and six months ended June 30, 2012, the Company recognized non-cash compensation expense of $0.4 million and $1.7 million, respectively, related to stock options. These amounts were recorded as general and administrative expense. Because the Company does not pay significant United States federal income taxes, no amounts were recorded for tax benefits related to excess stock based compensation deductions.

A summary of the stock option activity for the six months ended June 30, 2013 is provided below:

 

     Number of  Shares
Underlying Options
(in thousands)
    Weighted
Average Exercise
Price Per Share
     Weighted
Average
Remaining
Contractual
Term
     Aggregate
Intrinsic  Value
(in millions)
 

Outstanding at beginning of period

     4,065      $ 6.12         2.65      

Granted

     1,236        7.59         4.71      

Exercised

     (32     4.24         0.28      

Forfeited

     —          —           —        
  

 

 

   

 

 

    

 

 

    

Outstanding at end of period

     5,269      $ 6.47         2.77       $ 6.62   
  

 

 

   

 

 

    

 

 

    

 

 

 

Exercisable at end of period

     4,386      $ 6.15         2.45       $ 6.62   
  

 

 

   

 

 

    

 

 

    

 

 

 

The intrinsic value of a stock option is the amount by which the current market value of the underlying stock exceeds the exercise price of the option.

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

As of June 30, 2013, unrecognized compensation costs totaled $1.7 million. The expense is expected to be recognized over a weighted average period of 1.4 years.

 

4. COMMITMENTS AND CONTINGENCIES

Offshore Gabon

The Company entered into a sixth exploration period extension during 2009 and is required to spend $5.3 million for its share of two exploration wells and to acquire and process 150 square kilometers of 3-D seismic on the Etame Marin block by July 2014. One of the two exploration commitment wells was drilled in 2010 on the Omangou prospect at a cost of $8.6 million ($2.6 million net to the Company). The seismic obligation was met with the acquisition of 223 square kilometers of 3-D seismic in 2012. The remaining obligation is the drilling of one exploration well which is scheduled to be drilled in the third quarter of 2013. The well to be drilled is the Ovoka 1 well located approximately 5 miles northeast of the Ebouri field and 6 miles north of the Etame field.

As part of securing the second ten-year production license with the government of Gabon, the Company agreed in principle to a cash funding arrangement for the eventual abandonment of the offshore wells, platforms and facilities. The agreement is not yet finalized, but calls for annual funding for the next seven years at 12.14% of the total abandonment estimate per year and 5.0% per year for the last three years of the production license. The amounts paid will be reimbursed through the cost account and are non-refundable to the Company. The funding will begin after the agreement is finalized. The abandonment estimate for this purpose is approximately $10.1 million net to the Company on an undiscounted basis. The obligation for abandonment of the Gabon offshore facilities is included in the asset retirement obligation shown on the Company’s balance sheet.

Angola

In November 2006, the Company signed a production sharing contract for Block 5 offshore Angola. The four year primary term with an optional three year extension awards the Company exploration rights to 1.4 million acres offshore central Angola. The Company’s working interest is 40%. Additionally, the Company is required to carry the Angolan national oil company, Sonangol P&P, for 10% of the work program. During the first four years of the contract, the Company was required to acquire and process 1,000 square kilometers of 3-D seismic data, drill two exploration wells and expend a minimum of $29.5 million ($14.8 million net to the Company). The Company fulfilled its seismic obligation when it acquired 1,175 square kilometers of 3-D seismic data at a cost of $7.5 million ($3.75 million net to the Company) in January 2007 and 524 square kilometers of 3-D seismic data during the fourth quarter of 2008 at a cost of $6.0 million ($3.0 million net to the Company). Each of the two exploration commitment wells is subject to a $5.0 million penalty ($10.0 million in aggregate for both wells) if not drilled during the contract term. The $10.0 million is currently recorded as restricted cash and is held at a financial institution located in the United States. Additional time extensions have been granted by the Angolan government to drill the two exploration commitment wells, the latest extension providing until November 30, 2014.

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

The government-assigned working interest partner was delinquent paying their share of the costs several times in 2009 and consequently was placed in a default position. By a governmental decree, dated December 1, 2010, the former partner was removed from the production sharing contract. Following the decree, the Company and the government of Angola have been working together to obtain a replacement partner.

In the second quarter of 2012, the Company identified a potential partner to acquire the available 40% working interest and submitted the name of the interested party to the Angolan government for approval. In July 2013, the Angolan government informed the Company that it should first proceed to acquire the available working interest per the provisions of the Joint Operating Agreement and then enter into a farm-out agreement with the potential partner. The Company is working to accomplish the two-step process outlined by the Angolan government. The Company cannot provide a time estimate for completing these activities as it involves actions by the Angolan government as well as the potential partner.

Due to the continuing circumstances regarding the available 40% working interest, the Company has recorded a full allowance totaling $7.2 million as of June 30, 2013, against the accounts receivable from partners for the amounts owed to the Company above its 40% working interest plus the 10% carried interest. The allowance recorded in the three and six months ended June 30, 2013 totaled $0.3 million and $1.1 million, respectively. The farm-out agreement, to be executed by the counterparty, provides for the Company to be reimbursed for the gross receivable amount. The timing of this event cannot be reasonably predicted at the present time.

 

5. CAPITALIZATION OF EXPLORATORY WELL COSTS

ASC Topic 932—Extractive Industries provides that an exploratory well shall be capitalized as part of the entity’s uncompleted wells pending the determination of whether the well has found proved reserves. Further, an exploration well that discovers oil and gas reserves, but those reserves cannot be classified as proved when drilling is completed, shall be capitalized if the well has found a sufficient quantity of reserves to justify its completion as a producing well and the entity is making sufficient progress assessing the reserves and the economic and operating viability of the project. If either condition is not met, the exploration well would be assumed to be impaired and its costs would be charged to expense.

In the second and third quarters of 2010, the Company drilled the Southeast Etame No. 1 well with two sidetracks in the Etame Marin block offshore Gabon. The well discovered a five meter column of oil in the Gamba sand reservoir. Additional evaluation of the well and sidetrack information was conducted to determine options for developing the discovery. In the second quarter of 2012, the Company and its partners agreed to proceed with the development plan featuring a fixed leg platform for developing the Southeast Etame discovery area and the North Tchibala field, where a discovery was made on the block prior to VAALCO’s block participation. The final investment decision was approved in the fourth quarter of 2012 for the construction of the platform. Construction began in the first quarter of 2013 and the platform is expected to be transported and installed in the first half of 2014. The Company has capitalized $8.1 million for this well in accordance with the criteria contained in ASC Topic 932.

 

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

In the third and fourth quarters of 2012, the Company drilled the N’Gongui No. 2 well with three sidetracks in the Mutamba Iroru block onshore Gabon. Application of the discovery was made timely to the government of Gabon, but the permit has yet to be issued. The Company has capitalized $7.9 million for this well in accordance with the criteria contained in ASC Topic 932.

 

6. REPURCHASE OF COMMON STOCK

On June 6, 2013, the Company announced that its Board of Directors has authorized the repurchase of up to $25 million of the Company’s common stock over the next 12 months. Under the share buyback program, shares of common stock will be purchased on the open market or through privately negotiated transactions from time-to-time. The share buyback program does not obligate the Company to acquire any specific number of shares in any period, and may be modified, suspended, extended or discontinued at any time without prior notice. During the quarter ended June 30, 2013, the Company repurchased 233,400 shares at an average price of $5.74 per share totaling $1.3 million.

As of August 1, 2013, the Company repurchased an additional 1,125,706 shares bringing the total amount of shares repurchased in this program to 1,359,106 shares. The average price paid for all shares was $6.00 per share totaling $8.2 million.

 

7. SEGMENT INFORMATION

The Company’s main operations are based in Gabon, Angola, Equatorial Guinea, and in the United States. Minor activities for the Company’s United Kingdom subsidiary is included in the “Corporate and Other” column in the table. Management reviews and evaluates the operation of each geographic segment separately. The operations of all segments include exploration for and production of hydrocarbons where commercial reserves have been found and developed. Revenues are based on the location of hydrocarbon production.

 

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NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

The Company evaluates each segment based on income (loss) from operations. Segment activity for the three months and six months ended June 30, 2013 and 2012 are as follows:

 

($ thousands)    Gabon      Angola     EG     USA     Corporate
and Other
    Total  

Three months ended June 30,

             

2013

             

Revenues

   $ 28,574       $ —        $ —        $ 544      $ —        $ 29,118   

Income from operations

     14,853         (379     (165     (1,336     (1,307     11,666   

2012

             

Revenues

   $ 57,886       $ —        $ —        $ 932      $ —        $ 58,818   

Income from operations

     45,258         (585     —          (3,843     (2,198     38,632   
($ thousands)    Gabon      Angola     EG     USA     Corporate
and Other
    Total  

Six months ended June 30,

             

2013

             

Revenues

   $ 72,229       $ —        $ —        $ 1,026      $ —        $ 73,255   

Income from operations

     45,717         (1,582     (455     (7,028     (3,482     33,170   

2012

             

Revenues

   $ 102,613       $ —        $ —        $ 1,491        $ 104,104   

Income from operations

     79,605         (1,199     —          (4,606     (5,061     68,739   

Total Assets

($ thousands)

   Gabon      Angola     EG     USA     Corporate
and Other
    Total  

As of June 30, 2013

   $ 208,545       $ 12,126      $ 10,010      $ 14,696      $ 26,846      $ 272,223   

As of December 31, 2012

     190,652         11,405        10,000        17,314        38,585        267,956   

 

 

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Report 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, which are intended to be covered by the safe harbors created by those laws. The Company has based these forward-looking statements on its current expectations and projections about future events. These forward-looking statements include information about possible or assumed future results of the Company’s operations. All statements, other than statements of historical facts, included in this Report that address activities, events or developments that the Company expects or anticipates may occur in the future, including without limitation, statements regarding the Company’s financial position, operating performance and results, reserve quantities and net present values, market prices, business strategy, derivatives activities, the amount and nature of capital expenditures, plans and objectives of the Company’s management for future operations are forward-looking statements. When the Company uses words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “forecast,” “outlook,” “aim,” “will,” “could,” “should,” “may,” “likely,” “plan,” “probably” or similar expressions, the Company is making forward-looking statements. Many risks and uncertainties that could affect the Company’s future results and could cause results to differ materially from those expressed in the Company’s forward-looking statements include, but are not limited to: the volatility of oil and natural gas prices; the uncertainty of estimates of oil and natural gas reserves; the impact of competition; the availability and cost of seismic, drilling and other equipment; operating hazards inherent in the exploration for and production of oil and natural gas; difficulties encountered during the exploration for and production of oil and natural gas; difficulties encountered in delivering oil to commercial markets; discovery, acquisition, development and replacement of oil and gas reserves; timing and amount of future production of oil and gas; hedging decisions, including whether or not to enter into derivative financial instruments; our ability to effectively integrate companies and properties that we acquire; general economic conditions, including any future economic downturn, disruption in financial markets and the availability of credit; changes in customer demand and producers’ supply; future capital requirements and the Company’s ability to attract capital; currency exchange rates; actions by the governments and events occurring in the countries in which we operate; actions by our venture partners; compliance with, or the effect of changes in, governmental regulations regarding the Company’s exploration and production, including those related to climate change; actions of operators of the Company’s oil and gas properties; weather conditions; and statements set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012.

Although the Company believes that the assumptions underlying its forward-looking statements are reasonable, any of these assumptions and therefore also the forward-looking statements based on these assumptions, could themselves prove to be inaccurate. In light of the significant uncertainties inherent in the forward-looking statements which are included in this Report, the Company’s inclusion of this information is not a representation by the Company or any other person that the Company’s objectives and plans will be achieved.

 

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The Company’s forward-looking statements speak only as of the date made and the Company will not update these forward-looking statements unless the securities laws require the Company to do so. The Company’s forward-looking statements are expressly qualified in their entirety by this cautionary statement. In light of these risks, uncertainties and assumptions, any forward-looking events discussed in this Report may not occur.

INTRODUCTION

VAALCO owns producing properties and conducts exploration activities as an operator in Gabon, West Africa, conducts exploration activities as an operator in Angola, West Africa, and conducts exploration activities as a non-operator in Equatorial Guinea, West Africa. VAALCO is the operator of unconventional and conventional resource properties in the United States located in Montana and North Texas. The Company also owns minor interests in conventional production activities as a non-operator in the United States.

A significant component of the Company’s results of operations is dependent upon the difference between prices received for its offshore Gabon oil production and the costs to find and produce such oil. Oil (and gas) prices have been and are expected in the future to be volatile and subject to fluctuations based on a number of factors beyond the control of the Company. Similarly, the costs to find and produce oil and gas are largely not within the control of the Company, particularly in regard to the cost of leasing drilling rigs to drill and maintain offshore wells.

Offshore Gabon

The Company’s primary source of revenue is from the Etame Production Sharing Contract related to the Etame Marin block located offshore the Republic of Gabon. VAALCO operates the Etame Marin block on behalf of a consortium of five. VAALCO owns a 30.35% interest in the exploration acreage within the Etame Marin block. The Company owns a 28.1% interest in the development areas in and surrounding the Etame, Avouma, South Tchibala, and Ebouri fields, each of which is located on the Etame Marin block. The development areas were subject to a 7.5% back-in by the Government of Gabon, which occurred for these fields after their successful development. The Southeast Etame and North Tchibala fields, each of which is also located on the Etame Marine block, are in the process of being developed and will also be subject to a 7.5% back-in by the Government of Gabon.

A key focus of the Company is to maintain oil production from the Etame Marin block at optimal levels within the constraints of the existing infrastructure. Five subsea wells plus production from two platforms are tied back by pipelines to deliver oil and associated gas through a riser system to allow for delivery, processing, storage and ultimately offloading the oil from a leased Floating, Production, Storage and Offloading vessel (“FPSO”) anchored to the seabed on the block. With the FPSO limitations of approximately 25,000 BOPD and 30,000 barrels of total fluids per day, the challenge is to optimize production on both a near and long-term basis subject to investment and operational agreements between the Company and the consortium. The Company produces from the Etame, Avouma, South Tchibala and Ebouri fields on the block. During the three and six months ending June 30, 2013, these fields produced approximately 1.5 million Bbls (0.4 million Bbls net to the Company) and 3.0 million Bbls (0.7 million Bbls net to the Company), respectively. The Company’s share of barrels sold reflects an allocation of cost oil and profit oil, and a reduction for royalty of 13%.

 

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During 2011 and 2012, the Company invested in platform modifications to both the Ebouri and Avouma offshore platforms to accommodate the drilling of additional wells in addition to upgrading the electrical and power generation systems on both platforms. A new personnel accommodation module was installed during 2012 at the Avouma platform. Water knock-out facilities at the Avouma platform are expected to go on-line in the second half of 2013.

The Company has developed a drilling and workover campaign to drill new wells and to perform workovers to replace electrical submersible pumps in existing wells. Late in 2012, the Company commenced work on this campaign with the arrival of a drilling rig to conduct a six well program, with an option to extend the program to a total of eight wells. The six well program included three successful well recompletions to replace electrical submersible pumps, a development well that was successfully drilled and put on production in the Avouma field in April 2013, an unsuccessful exploration appraisal well drilled in the Ebouri field, and an exploration well which is expected to be drilled in the third quarter of 2013 on the Ovoka prospect. The Company and its partners expect to exercise the rig option in the third quarter of 2013 for the additional two wells in the program.

Long-term optimization progress was made in 2012 by the Company and its partners approving the construction of two additional production platforms. The two production platforms are part of the future development plans for the Etame Marin block. One platform will be located in the Etame field and the second platform will be located in-between the Southeast Etame and North Tchibala fields. Multiple wells are expected to be drilled from each of the platforms as part of the future development plans for the Etame Marin block. The Company drilled a successful exploration well in the Southeast Etame area in 2010 which will be developed from the second platform. The expected cost to build and install the platforms in the 2013/2014 timeframe is $325.0 million ($91.0 million net to the Company). The cost of the wells is not included in the platform costs. Construction of the two production platforms began in the first quarter of 2013.

In 2012, the presence of hydrogen sulfide (H2S) from two of the three producing wells in the Ebouri field was discovered. The wells were shut-in for safety reasons resulting in a decrease of approximately 2,000 BOPD or approximately 10% of the gross daily production from the Etame Marin block. Analysis and options for re-establishing production from the impacted area was undertaken in the second half of 2012. The expected outcome is that additional capital investment will be required, which is likely to include a new platform-type structure with H2S processing capability, and new wells to re-establish production from the impacted area. The design, cost projections and final investment decisions by the Company and its partners are expected to be made in the second half of 2013. Re-establishing production from the area impacted by H2S is expected in the first half of 2016. In the second quarter of 2013, the Company spent $0.5 million ($0.2 million net to the Company) to temporarily suspend the two affected wells.

Onshore Gabon

Besides the offshore Etame Marin block in Gabon, the Company operates the Mutamba Iroru block located onshore near the coast in central Gabon. The Mutamba Iroru block contains an exploration area of approximately 270,000 acres. The Company currently has a 50% working interest in the block. The Company entered into an agreement with Total Gabon in 2010 to continue the exploration

 

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activities. Under the terms of the agreement, the Company and Total Gabon committed to reprocess 400 kilometers of 2-D seismic data and drill one exploration well. The seismic reprocessing work was completed in 2012.

The exploration well was drilled in 2012 resulting in a discovery at a cost of $19.6 million ($7.9 million net to the Company). Application of the discovery was made timely to the government of Gabon, but the permit has yet to be issued. Development of the onshore block is expected to capitalize on synergies such as office space, warehouse and open yard space and experienced personnel from our operating base in Port Gentil, Gabon.

In 2010, the exploration permit was successfully extended until May 2012 and an application for a further nine-month extension was made in early 2012. The Company and Total Gabon are working with the Gabon government to finalize the extension and to obtain a further exploration extension. The negotiations have continued without reaching agreement. The government of Gabon has proposed new financial and other terms which have not been accepted by the Company. The Company can provide no assurances that an agreement for an extension of the exploration permit will be reached with the government of Gabon.

Offshore Angola

In November 2006, the Company signed a production sharing contract for Block 5 offshore Angola. The four year primary term with an optional three year extension awards the Company exploration rights to 1.4 million acres offshore central Angola. The Company’s working interest is 40%.

By a governmental decree, dated December 1, 2010, the former partner was removed from the production sharing contract. Following the decree, the Company and the government of Angola have been working together to obtain a replacement partner. Additional time extensions have been granted by the Angolan government to drill the two exploration commitment wells, the latest extension providing until November 30, 2014 to drill.

In the second quarter of 2012, the Company identified a potential partner to acquire the available 40% working interest and submitted the name of the interested party to the Angolan government for approval. In July 2013, the Angolan government informed the Company that it should first proceed to acquire the available working interest per the provisions of the Joint Operating Agreement and then enter into a farm-out agreement with the potential partner. The Company is working to accomplish the two-step process outlined by the Angolan government. The Company cannot provide a time estimate for completing these activities as it involves actions by the Angolan government as well as the potential partner.

Due to the continuing circumstances regarding the available 40% working interest, the Company has recorded a full allowance totaling $7.2 million as of June 30, 2013, against the accounts receivable from partners for the amounts owed to the Company above its 40% working interest plus the 10% carried interest. The allowance recorded in the three and six months ended June 30, 2013 totaled $0.3 million and $1.1 million, respectively. The farm-out agreement, to be executed by the counterparty, provides for the Company to be reimbursed for the gross receivable amount. The timing of this event cannot be reasonably predicted at the present time.

 

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Offshore Equatorial Guinea

An important goal for the Company is establishing meaningful production operations in more than one country. The Company routinely evaluates working interest opportunities primarily in the West African geographic area where the Company has significant expertise and where the base of the foreign operations is located.

During 2012, the Company identified an opportunity to purchase a working interest in Block P, Equatorial Guinea. In November 2012, the Company completed the acquisition of a 31% working interest in the block at a cost of $10.0 million. Prior to the Company’s acquisition, two oil discoveries had been made on the block, and there is exploration potential on other areas of the block.

Onshore Domestic - Texas

The Company acquired a 640 acre lease, the Hefley field, in the Granite Wash formation in North Texas in December 2010 and a 480 acre lease in the same formation in July 2011. Two wells have been drilled on the Hefley lease acreage and brought on production. The second well began production in March 2012. During the three months ended June 30, 2013, the two wells produced approximately 1,600 Bbls of oil and 87 million cubic feet of gas net to the Company after deduction of royalty and severance taxes. During the six months ended June 30, 2013, the two wells produced approximately 2,400 Bbls of oil and 180 million cubic feet of gas net to the Company after deduction of royalty and severance taxes The Hefley field acreage is held by production. In the second quarter 2013, the Company decided it was unlikely to conduct further exploratory activities on the unevaluated portion of the Hefley field. Accordingly, the Company charged $0.7 million to exploration expense, which represented the remaining book value of the unevaluated Hefley leasehold. The expiration date of the primary term of the 480 acre Granite Wash lease is August 2014.

Onshore Domestic - Montana

In May 2011, the Company acquired a 70% working interest in approximately 5,200 acres (3,640 net acres) in Sheridan County, Montana in the Middle Bakken formation. The Company drilled two wells on this acreage in 2012. After completion testing beginning in the fourth quarter of 2012 using electrical submersible pumps (ESP’s), both of the wells drilled were determined to be unsuccessful as the operating and water disposal costs exceeded the value of the gas and condensate produced from the wells. Dry-hole cost and leasehold impairment totaling $15.7 million was recognized for these two wells ($14.2 million in the fourth quarter of 2012 and $1.5 million in the first quarter 2013). Leasehold cost of $0.5 million remains capitalized for the acreage in Sheridan County, Montana.

 

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In September 2011, the Company acquired a 65% working interest in approximately 22,000 gross acres (14,300 net acres) covering the Middle Bakken and deeper formations in the East Poplar unit and the Northwest Poplar field in Roosevelt County, Montana. Pursuant to the terms of the acquisition, the Company was required to drill three wells at its sole cost, one of which was required to be drilled by June 1, 2012 and the remaining two wells were required to be drilled by the end of 2012. A vertical exploration well, which met the time requirement for drilling the first well, was spudded in December 2011 to evaluate the formations. The second exploration well was drilled and completed in the Bakken/Three Forks formations. Both of these wells were unsuccessful efforts, resulting in dry-hole costs and leasehold impairment totaling $18.4 million recorded in the fourth quarter of 2012. The third obligatory well was drilled in the fourth quarter of 2012 at a cost of $2.7 million. Additional completion activities on this well are expected in the second half of 2013 following an expected assumption of operatorship by the other partner in the venture. Leasehold cost of $1.3 million remains capitalized for this acreage in Roosevelt County, Montana.

CAPITAL RESOURCES AND LIQUIDITY

Cash Flows

Net cash used by operating activities for the six months ended June 30, 2013 was $9.5 million, as compared to net cash provided by operating activities of $28.0 million for the six months ended June 30, 2012. The decrease in cash from operations for the six months ended June 30, 2013 compared to the six months ended June 30, 2012 was primarily due to a $8.5 million reduction in net income and a $31.7 million negative variance in changes in operating assets and liabilities, partially offset by a $2.7 million positive variance in non-cash adjustments. The $31.7 million negative variance in changes in operating assets and liabilities was primarily due to two Gabon oil liftings totaling $26.1 million that occurred in the second quarter of 2013, but were not yet due for payment by the buyer as of June 30, 2013, and the repayment of joint venture partner cash call amounts that were billed in excess.

Net cash used in investing activities for the six months ended June 30, 2013 was $41.3 million, compared to net cash used in investing activities for the six months ended June 30, 2012 of $27.1 million. For the six months ended June 30, 2013 the Company paid $40.8 million for capital expenditures, and added $0.5 million to its restricted cash balance in Gabon. For the six months ended June 30, 2012 the Company paid $27.2 million for capital expenditures, which was partially offset by a $0.1 million release of restricted cash in Gabon.

For the six months ended June 30, 2013, net cash used in financing activities was $1.2 million consisting of treasury stock purchases of $1.3 million, partially offset by the receipt of $0.1 million in proceeds from the issuance of common stock upon the exercise of stock options. For the six months ended June 30, 2012, cash used in financing activities was $0.2 million consisting of distributions to a noncontrolling interest of $3.6 million, which was partially offset by the receipt of $3.4 million in proceeds from the issuance of common stock upon the exercise of stock options.

 

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Capital Expenditures

During the six months ended June 30, 2013, the Company incurred $34.3 million of net property and equipment additions, primarily associated with $19.9 million for the construction of two new platforms offshore Gabon, $10.5 million for two development wells offshore Gabon, and $2.5 million to complete the exploratory well onshore Gabon.

During the second half of 2013, the Company anticipates its share of capital expenditures will approximate $45.0 million primarily associated with the offshore Gabon block for the construction of two platforms and the drilling of two exploration wells.

Oil and Gas Exploration Costs

The Company uses the “successful efforts” method of accounting for its oil and gas exploration and development costs. All expenditures related to exploration, with the exception of costs of drilling exploratory wells, are charged as an expense when incurred. The costs of exploratory wells are capitalized pending determination of whether commercially producible oil and natural gas reserves have been discovered. If the determination is made that a well did not encounter potentially economic oil and gas quantities, the well costs are charged as an expense.

For the six months ended June 30, 2013, exploration expense was $10.4 million, including $6.4 million related principally to the Company’s dry-hole costs in its United States properties, and $3.0 million of dry-hole costs related to the unsuccessful Ebouri appraisal well. Additional exploration costs incurred in the six months ended June 30, 2013 were $0.4 million onshore Gabon, $0.3 million offshore Gabon, and $0.2 million in Equatorial Guinea.

For the six months ended June 30, 2012, exploration expense was $4.3 million, consisting primarily of a $2.9 million dry-hole charge to write-off the exploratory costs associated with drilling and testing of several intervals below the Bakken/Three Forks formation on a well drilled in the East Poplar Dome field in Montana. Additional exploration costs incurred in the six months ended June 30, 2012 were $0.4 million in North America, $0.1 million in the United Kingdom, $0.4 million onshore Gabon, and $0.5 million offshore Gabon

Liquidity

The Company’s primary source of capital has been cash flows from operations. At June 30, 2013, the Company had unrestricted cash of $78.7 million. The Company believes that this cash combined with cash flow from operations will be sufficient to fund the Company’s remaining 2013 capital expenditure budget, and additional investments in working capital resulting from potential growth. As operator of the Etame Marin and Mutamba Iroru blocks in Gabon, Block 5 in Angola, the Company enters into project related activities on behalf of its working interest partners. The Company generally obtains advances from its partners prior to significant funding commitments.

Substantially all of the Company’s crude oil and natural gas is sold at the well head at posted or index prices under short-term contracts. In Gabon, the Company markets its crude oil under an agreement with Mercuria Trading NV (“Mercuria”). While the loss of Mercuria as a buyer might have a material adverse effect on the Company in the near term, management believes that the Company would be able to obtain other customers for its crude oil in Gabon.

 

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Domestic operated production in Texas is sold via two contracts, one for oil and one for gas and natural gas liquids. The Company has access to several alternative buyers for oil, gas, and natural gas liquids domestically.

 

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RESULTS OF OPERATIONS

Three months ended June 30, 2013 compared to three months ended June 30, 2012

Total Revenues

Total oil and natural gas revenues were $29.1 million for the three months ended June 30, 2013 compared to $58.8 million the same period of 2012.

Oil Revenues

Gabon

Crude oil revenues for the three months ended June 30, 2013 were $28.6 million, a $29.3 million decrease from revenues of $57.9 million for the same period in 2012. In the three months ended June 30, 2013, the Company sold approximately 280,000 net barrels of oil at an average price of $102.21/Bbl., while in the three months ended June 30, 2012 it sold approximately 538,000 net barrels of oil at an average price of $107.51/Bbl. Sales volumes declined in the three months ended June 30, 2013 as compared to the same period in 2012 due to temporary production stoppages resulting from workover activities for replacing electrical submersible pumps on three offshore Gabon wells, as well as the July 2012 shut-in of two of the three producing wells in the Ebouri field, offshore Gabon, as a precaution after detecting H2S.

United States

Condensate sales from the Granite Wash formation wells, located in Hemphill County, Texas for the period ended June 30, 2013 were $0.1 million, resulting from the sale of approximately 1,600 net barrels of oil at an average price of $84.99. For the same period in 2012, condensate sales were $0.3 million, resulting from the sale of approximately 4,000 net barrels of oil condensate at an average price of $83.25/Bbl.

Natural Gas Revenues

United States

Natural gas revenues including revenues from natural gas liquids for the three months ended June 30, 2013 were $0.4 million compared to $0.6 million for the same period in 2012. Natural gas sales volumes were 88 MMcf at an average price of $4.60/Mcf for the three months ended June 30, 2013, compared to sales volumes of 158 MMcf at an average price of $3.90/Mcf for the same period in 2012.

Operating Costs and Expenses

Total production expenses for the three months ended June 30, 2013 were $7.0 million compared to $6.5 million for the same period in 2012. The higher production expenses in the three months ended June 30, 2013 compared to the same period in 2012 were primarily due to $4.5 million of well workover costs to replace electrical submersible pumps on three offshore Gabon wells, partially

 

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offset by $2.2 million lower production costs resulting from higher expenses capitalized associated with unsold crude oil inventory, $1.3 million lower operating expenses for the FPSO facility, and $0.8 million lower expenses for the Domestic Market Obligation (“DMO”) to the Republic of Gabon. For the three months ended June 30, 2013, the Company’s Gabon production was approximately 16,900 BOPD (4,100 BOPD net to the Company), as compared to approximately 20,100 BOPD (4,900 BOPD net to the Company) for the same period in 2012.

Exploration expenses for the three months ended June 30, 2013 was $4.3 million, compared to $3.5 million for the same period in 2012. For the three months ended June 30, 2013, exploration expenses consisted primarily of $3.0 million dry-hole costs related to the unsuccessful Ebouri appraisal well offshore Gabon, $0.7 million to expense the remaining unevaluated leasehold cost of the Hefley lease in the Texas Granite Wash area, and $0.5 million additional dry-hole costs related to other United States properties that were previously deemed unsuccessful. For the three months ended June 30, 2012, exploration expenses consisted primarily of a $2.9 million dry-hole charge to write-off the exploratory costs associated with the drilling and testing of several intervals below the Bakken/Three Forks formation on a well drilled in the East Poplar Dome field in Montana. Additional exploratory costs incurred in the three months ended June 30, 2012 were $0.3 million in North America, and $0.2 million offshore Gabon.

Depreciation, depletion and amortization expenses were $3.4 million in the three months ended June 30, 2013 compared to $6.9 million in the three months ended June 30, 2012. The lower depreciation, depletion and amortization expenses during the three months ended June 30, 2013 compared to the same period in 2012 were primarily due to lower sales volumes in Gabon as a result of the two wells shut-in for the H2S issue in July 2012 and three wells that underwent replacement of electrical submersible pumps.

General and administrative expenses for the three months ended June 30, 2013 and 2012 were $2.5 million and $3.0 million, respectively. The decrease in general and administrative costs in the three months ended June 30, 2013 compared to the same period in 2012 was primarily due to a $1.7 million cost reduction due to higher overhead reimbursements resulting from the active development program offshore Gabon, partially offset by higher stock compensation expenses of $0.4 million, and higher support services costs of $0.5 million.

Other Income

Other income for the three months ended June 30, 2013 was $14,000, comprised principally of interest income. Other income for the three months ended June 30, 2012 was $0.4 million, comprised primarily of a foreign exchange gain of $0.4 million.

Income Taxes

Income tax expense amounted to $4.6 million and $26.7 million for the three months ended June 30, 2013 and 2012, respectively. In the three months ended June 30, 2013 and 2012, the income taxes were all paid in Gabon. Income taxes in the three months ended June 30, 2013 were lower due to lower sales volumes and a lower percentage of oil allocated as “profit oil” versus “cost oil”. The income taxes the consortium pays the government of Gabon is an allocation of the remaining profit oil production from a specific contract area ranging from 50% to 60% of the oil remaining after deducting the royalty and the cost oil.

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

 

Net Income

Net income for the three months ended June 30, 2013 was $7.1 million, compared to $12.3 million for the same period in 2012. Net income allocated to the noncontrolling interest was $1.9 million in the three months ended June 30, 2012.

The noncontrolling interest, which was associated with VAALCO Energy (International), Inc., a subsidiary that was 90.01% owned by the Company, was acquired by the Company at a cost of $26.2 million effective October 1, 2012.

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

 

Six months ended June 30, 2013 compared to six months ended June 30, 2012

Total Revenues

Total oil and natural gas revenues were $73.3 million for the six months ended June 30, 2013 compared to $104.1 million for the same period of 2012.

Oil Revenues

Gabon

Crude oil revenues for the six months ended June 30, 2013 were $72.2 million, a $30.4 million decrease from revenues of $102.6 million for the same period of 2012. The Company sold approximately 676,000 net barrels of oil equivalent at an average price of $106.82/Bbl. in the six months ended June 30, 2013. The Company sold approximately 906,000 net barrels of oil equivalent at an average price of $113.25/Bbl. in the six months ended June 30, 2012. Sales volumes declined in the six months ended June 30, 2013 as compared to the same period in 2012 due to temporary production stoppages resulting from workover activities for replacing electrical submersible pumps on three offshore Gabon wells, as well as the July 2012 shut-in of two wells in the Ebouri field, offshore Gabon, as a precaution after detecting H2S.

United States

Condensate sales from the Granite Wash wells, located in Hemphill County, Texas for the six months ended June 30, 2013 were $0.2 million, resulting from approximately 2,400 barrels at an average price of $80.67/Bbl. Condensate sales for the six months ended June 30, 2012 were $0.4 million, resulting from approximately 5,000 barrels at an average price of $85.25/Bbl.

Natural Gas Revenues

United States

Natural gas revenues, including revenues from natural gas liquids, for the six months ended June 30, 2013 were $0.8 million compared to $1.0 million for the comparable period in 2012. Natural gas sales volumes were 183 MMcf at an average price of $4.47/Mcf for the six months ended June 30, 2013, compared to sales volumes of 274 MMcf at an average price of $3.82/Mcf for the same period in 2012.

Operating Costs and Expenses

Total production expenses for the six months ended June 30, 2013 were $15.4 million compared to $12.1 million in the six months ended June 30, 2012. The higher production expenses in the six months ended June 30, 2013 were primarily associated with $ 5.7 million of workover costs to replace failed electrical submersible pumps, partially offset by $1.5 million lower production costs resulting from higher expenses capitalized associated with unsold crude oil inventory, $1.1 million lower expenses for the DMO payable to the Republic of Gabon. For the six months ended June 30, 2013, the Company’s Gabon production was approximately 16,700 BOPD (4,100 BOPD net to the Company), as compared to approximately 20,700 BOPD (5,000 BOPD net to the Company) for the six months ended June 30, 2012.

 

24


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VAALCO ENERGY, INC. AND SUBSIDIARIES

 

For the six months ended June 30, 2013, exploration expense was $10.4 million, including $6.4 million related principally to the Company’s dry-hole costs in its United States properties, and $3.0 million dry-hole costs related to the unsuccessful Ebouri appraisal well. Additional exploration costs incurred in the six months ended June 30, 2013 were $0.4 million onshore Gabon, $0.3 million offshore Gabon, and $0.2 million in Equatorial Guinea.

For the six months ended June 30, 2012, exploration expense was $4.3 million, consisting primarily of a $2.9 million dry-hole charge to write-off the exploratory costs associated with the drilling and testing of several intervals below the Bakken/Three Forks formation on a well drilled in the East Poplar Dome field in Montana. Additional exploratory costs incurred in the six months ended June 30, 2012 were $0.4 million in North America, $0.1 million in the United Kingdom, $0.4 million onshore Gabon, and $0.5 million offshore Gabon.

Depreciation, depletion and amortization expenses were $7.1 million in the six months ended June 30, 2013 compared to $11.9 million in the six months ended June 30, 2012. The lower depreciation, depletion and amortization expenses during the six months ended June 30, 2013 compared to the same period in 2012 were primarily due to lower sales volumes in Gabon as a result of two wells shut-in for the H2S issue in July 2012 and three wells that underwent replacement of electrical submersible pumps.

General and administrative expenses for the six months ended June 30, 2013 and 2012 were $6.1 million and $6.5 million, respectively. During the six months ended June 30, 2013, the Company incurred $2.2 million of stock based compensation expense compared to $1.7 million incurred in the six months ended June 30, 2012. In both of the six month periods ended June 30, 2013 and 2012, the Company benefited from overhead reimbursement associated with production and development operations on the Etame Marin block. Overhead reimbursement for the six months ended June 30, 2013 was $2.2 million compared to $1.2 million in the same period in 2012.

Other Income (expense)

Other expense for the six months ended June 30, 2013 was $55,000, compared to other income of $0.7 million for the same period in 2012. The other expense and other income recorded in each of the six months ended June 30, 2013 and 2012 were primarily attributable to foreign exchange transactions.

Income Taxes

Income tax expense amounted to $18.8 million and $46.5 million for the six months ended June 30, 2013 and 2012, respectively. In the six months ended June 30, 2013 and 2012, the income taxes were all paid in Gabon. Income taxes in the six months ended June 30, 2013 were lower due to lower sales volumes and a lower percentage of oil allocated as “profit oil” versus “cost oil.” The income taxes the consortium pays the government of Gabon is an allocation of the remaining profit oil production from a specific contract area ranging from 50% to 60% of the oil remaining after deducting the royalty and the cost oil.

Net Income

Net income for the six months ended June 30, 2013 was $14.3 million, compared to a net income of $22.8 million for the same period in 2012. Net income allocated to the noncontrolling interest for the six months ended June 30, 2012 was $3.4 million.

The noncontrolling interest, which was associated with VAALCO Energy (International), Inc., a subsidiary that was 90.01% owned by the Company, was acquired by the Company at a cost of $26.2 million effective October 1, 2012.

 

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VAALCO ENERGY, INC. AND SUBSIDIARIES

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company’s results of operations are dependent upon the difference between prices received for its oil and gas production and the costs to find and produce such oil and gas. Oil and gas prices have been and are expected in the future to be volatile and subject to fluctuations based on a number of factors beyond the control of the Company. The Company does not presently have any active hedges in place, but may do so in the future.

 

ITEM 4. CONTROLS AND PROCEDURES

The Company maintains disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Chief Executive Officer and Chief Financial Officer to allow timely decisions regarding required disclosure. The Company’s management, including the Company’s principal executive officer and principal financial officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, the Company’s principal executive officer and principal financial officer have concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report on Form 10-Q. There were no changes in the Company’s internal controls over financial reporting that occurred during the Company’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect the Company’s internal control over financial reporting.

 

26


Table of Contents

PART II. OTHER INFORMATION

 

ITEM 1A. RISK FACTORS

Other than as described below, there have been no material changes to the disclosure on this matter in our annual report on form 10-K for the year ended December 31, 2012.

We have less control over our foreign investments than domestic investments, and turmoil in foreign countries may affect our foreign investments.

Our international assets and operations are subject to various political, economic and other uncertainties, including, among other things, the risks of war, expropriation, nationalization, renegotiation or nullification of existing contracts, taxation policies, foreign exchange restrictions, changing political conditions, international monetary fluctuations, currency controls and foreign governmental regulations that favor or require the awarding of drilling contracts to local contractors or require foreign contractors to employ citizens of, or purchase supplies from, a particular jurisdiction. For example, the Gabonese government has recently audited the accounts of a number of energy companies that has led to disputes and may have caused the cancellation of a contract with an operator and is currently in the process of auditing our accounts, the Gabonese government has formed a new oil company that may seek to participate in oil and gas projects in a manner that could be dilutive to the interest of current license holders and the Gabonese government is under pressure from the Gabonese labor union to require companies to hire Gabonese citizens. In addition, if a dispute arises with foreign operations, we may be subject to the exclusive jurisdiction of foreign courts or may not be successful in subjecting foreign persons, especially foreign oil ministries and national oil companies, to the jurisdiction of the United States. Private ownership of oil and gas reserves under oil and gas leases in the United States differs distinctly from our ownership of foreign oil and gas properties. In the foreign countries in which we do business, the state generally retains ownership of the minerals and consequently retains control of, and in many cases participates in, the exploration and production of hydrocarbon reserves. Accordingly, operations outside the United States may be materially affected by host governments through royalty payments, export taxes and regulations, surcharges, value added taxes, production bonuses and other charges.

Almost all of our proven reserves are located offshore of the Republic of Gabon. We have operated in Gabon since 1995 and believe we have good relations with the current Gabonese government. However, there can be no assurance that present or future administrations or governmental regulations in Gabon will not materially adversely affect our operations or cash flows.

There has been a recent surge in piracy in the Gulf of Guinea region including waters off Gabon. Unlike waters off the coast of East Africa, where ships can move past at high speed with armed guards on board, many vessels, including our productions platforms, have to anchor off West African coastal nations, with little protection. Our offshore operations and personnel may therefore be subject to armed robbery, hijack and kidnap for ransom, which could result in a cessation of operations.

 

ITEM 6. EXHIBITS

(a) Exhibits

3. Articles of Incorporation and Bylaws

 

  3.1 Amended and Restated Bylaws (filed as Exhibit 3.1 to Company’s Report on Form 8-K filed with the Commission on March 2, 2009, and hereby incorporated by reference herein)

31. Rule 13a-14(a)/15d-14(a) Certifications

 

  31.1 Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002.

 

  31.2 Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002.

Section 1350 Certificates

 

  32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002.

 

  32.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002.

101.INS XBRL Instance Document. *

101.SCH XBRL Taxonomy Schema Document. *

101.CAL XBRL Calculation Linkbase Document. *

101.DEF XBRL Definition Linkbase Document. *

101.LAB XBRL Label Linkbase Document. *

101.PRE XBRL Presentation Linkbase Document. *

 

27


Table of Contents

 

* Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.

 

28


Table of Contents

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

VAALCO ENERGY, INC.

(Registrant)

 

By  

/s/ GREGORY R. HULLINGER

  Gregory R. Hullinger,
 

Chief Financial Officer

(on behalf of the Registrant and as the

principal financial officer)

Dated: August 8, 2013

 

29


Table of Contents

EXHIBIT INDEX

Exhibits

3. Articles of Incorporation and Bylaws

 

  3.1 Amended and Restated Bylaws (filed as Exhibit 3.1 to Company’s Report on Form 8-K filed with the Commission on March 2, 2009, and hereby incorporated by reference herein)

Rule 13a-14(a)/15d-14(a) Certifications

 

  31.1 Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002.

 

  31.2 Certification pursuant to section 302 of the Sarbanes-Oxley Act of 2002.

Section 1350 Certificates

 

  32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002.

 

  32.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act Of 2002.

101.INS XBRL Instance Document. *

101.SCH XBRL Taxonomy Schema Document. *

101.CAL XBRL Calculation Linkbase Document. *

101.DEF XBRL Definition Linkbase Document. *

101.LAB XBRL Label Linkbase Document. *

101.PRE XBRL Presentation Linkbase Document. *

 

 

* Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.

 

30

EX-31.1 2 d553407dex311.htm EX-31.1 EX-31.1

Exhibit 31.1

I, Robert L. Gerry, III, certify that:

 

  (1) I have reviewed this quarterly report on Form 10-Q of VAALCO Energy, Inc.;

 

  (2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

  (3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

  (4) The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

  (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

  (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


  (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

  (5) The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

  (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date August 8, 2013

 

/s/Robert L. Gerry, III
Robert L. Gerry
Chief Executive Officer
EX-31.2 3 d553407dex312.htm EX-31.2 EX-31.2

Exhibit 31.2

I, Gregory R. Hullinger, certify that:

 

  (1) I have reviewed this quarterly report on Form 10-Q of VAALCO Energy, Inc.;

 

  (2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

  (3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

  (4) The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

  (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

  (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


  (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

  (5) The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

  (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date August 8, 2013

 

/s/Gregory R. Hullinger
Gregory R. Hullinger
Chief Financial Officer
EX-32.1 4 d553407dex321.htm EX-32.1 EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of VAALCO Energy, Inc. (the “Company”) on Form 10-Q for the quarterly period ended June 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Robert L. Gerry, III, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities and Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: August 8, 2013

 

/s/ Robert L. Gerry, III
Robert L. Gerry, Chief Executive Officer
EX-32.2 5 d553407dex322.htm EX-32.2 EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of VAALCO Energy, Inc. (the “Company”) on Form 10-Q for the quarterly period ended June 30, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gregory R. Hullinger, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities and Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: August 8, 2013

 

/s/Gregory R. Hullinger
Gregory R. Hullinger, Chief Financial Officer
EX-101.INS 6 egy-20130630.xml XBRL INSTANCE DOCUMENT 56662294 8200000 257389000 137796000 0.40 3748000 -23975000 200183000 6310000 71123000 4386000 63167438 6.47 5269000 2127046 6.15 100000000 5491038 0.10 163411000 51186000 33219000 227869000 227869000 7200000 33219000 195680000 6317000 272223000 44354000 11135000 4821000 26227000 127283000 3328000 10000000 1349000 272223000 78708000 198571000 5000000 296131000 6620000 4099000 6620000 10000000 7688000 7221000 1700000 61929000 642000 25314000 132720000 1770000 1 28410000 10871000 208545000 14696000 0.40 0.40 0.10 12126000 10010000 26846000 -25314000 195680000 6317000 51186000 233067000 137139000 3943000 -23975000 180739000 6238000 66122000 63135772 6.12 4065000 100000000 5257638 0.10 155968000 48816000 45063000 212525000 212525000 6000000 30326000 181370000 6314000 267956000 55431000 10368000 689000 7961000 149125000 683000 1349000 267956000 130800000 188208000 262576000 2935000 4463000 7574000 38137000 337000 23975000 106608000 14737000 1257000 28657000 10874000 190652000 17314000 11405000 10000000 38585000 -23975000 181370000 6314000 48816000 1000 EGY VAALCO ENERGY INC /DE/ false Accelerated Filer 2013 10-Q 2013-06-30 0000894627 --12-31 Q2 <div> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="4%" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">3.</font></td> <td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">STOCK-BASED COMPENSATION</font></td> </tr> </table> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">Stock options are granted under the Company&#x2019;s long-term incentive plan and have an exercise price that may not be less than the fair market value of the underlying shares on the date of grant. In general, stock options granted will become exercisable over a period determined by the Compensation Committee which in the past has been a five year life. A portion of the stock options granted in March 2013 and 2012 vested immediately with the remainder vesting over a two year period. In addition, stock options will become exercisable upon a change in control, unless provided otherwise by the Compensation Committee. At June&#xA0;30, 2013, there were 2,127,046 shares subject to options authorized but not granted.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">For the three months and six months ended June&#xA0;30, 2013, the Company recognized non-cash compensation expense of $0.8 million and $2.2 million, respectively, related to stock options. 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Because the Company does not pay significant United States federal income taxes, no amounts were recorded for tax benefits related to excess stock based compensation deductions.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">A summary of the stock option activity for the six months ended June&#xA0;30, 2013 is provided below:</font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px"> &#xA0;</p> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="92%" align="center"> <tr> <td width="51%"></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Number&#xA0;of&#xA0; Shares</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Underlying&#xA0;Options</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">(in thousands)</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Weighted<br /> Average&#xA0;Exercise<br /> Price Per Share</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Weighted</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Average</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Remaining</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Contractual</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Term</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Aggregate</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Intrinsic&#xA0; Value<br /> (in millions)</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Outstanding at beginning of period</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4,065</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.12</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.65</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Granted</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,236</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">7.59</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4.71</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Exercised</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(32</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4.24</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">0.28</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Forfeited</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Outstanding at end of period</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">5,269</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.47</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.77</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.62</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Exercisable at end of period</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4,386</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.15</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.45</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.62</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> </tr> </table> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The intrinsic value of a stock option is the amount by which the current market value of the underlying stock exceeds the exercise price of the option.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; FONT-SIZE: 1px"> &#xA0;</p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">As of June&#xA0;30, 2013, unrecognized compensation costs totaled $1.7 million. The expense is expected to be recognized over a weighted average period of 1.4 years.</font></p> </div> <div> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="4%" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">7.</font></td> <td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">SEGMENT INFORMATION</font></td> </tr> </table> <!-- xbrl,body --> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The Company&#x2019;s main operations are based in Gabon, Angola, Equatorial Guinea, and in the United States. Minor activities for the Company&#x2019;s United Kingdom subsidiary is included in the &#x201C;Corporate and Other&#x201D; column in the table. Management reviews and evaluates the operation of each geographic segment separately. The operations of all segments include exploration for and production of hydrocarbons where commercial reserves have been found and developed.&#xA0;Revenues are based on the location of hydrocarbon production. The Company evaluates each segment based on income (loss) from operations. Segment activity for the three months and six months ended June&#xA0;30, 2013 and 2012 are as follows:</font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px"> &#xA0;</p> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <!-- Begin Table Head --> <tr> <td width="56%"></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <!-- End Table Head --><!-- Begin Table Body --> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Three months ended June&#xA0;30,</b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2013</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">28,574</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">544</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">29,118</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">14,853</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(379</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(165</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,336</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,307</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">11,666</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2012</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,886</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">932</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,818</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">45,258</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(585</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3,843</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(2,198</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">38,632</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td height="16"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> </tr> <tr> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate<br /> and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Six months ended June&#xA0;30,</b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2013</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">72,229</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,026</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">73,255</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">45,717</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,582</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(455</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(7,028</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3,482</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">33,170</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><u><b>2012</b></u></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">102,613</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,491</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">104,104</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">79,605</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,199</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(4,606</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(5,061</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">68,739</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td height="16"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> </tr> <tr> <td valign="bottom"> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Total Assets</b></font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 1px"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate<br /> and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">As of June&#xA0;30, 2013</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">208,545</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">12,126</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">10,010</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">14,696</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">26,846</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">272,223</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">As of December&#xA0;31, 2012</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">190,652</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">11,405</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">10,000</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">17,314</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">38,585</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">267,956</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <!-- End Table Body --></table> </div> <div> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="4%" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">4.</font></td> <td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">COMMITMENTS AND CONTINGENCIES</font></td> </tr> </table> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2"><u>Offshore Gabon</u></font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The Company entered into a sixth exploration period extension during 2009 and is required to spend $5.3 million for its share of two exploration wells and to acquire and process 150 square kilometers of 3-D seismic on the Etame Marin block by July 2014. One of the two exploration commitment wells was drilled in 2010 on the Omangou prospect at a cost of $8.6 million ($2.6 million net to the Company). The seismic obligation was met with the acquisition of 223 square kilometers of 3-D seismic in 2012. The remaining obligation is the drilling of one exploration well which is scheduled to be drilled in the third quarter of 2013. The well to be drilled is the Ovoka 1 well located approximately 5 miles northeast of the Ebouri field and 6 miles north of the Etame field.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">As part of securing the second ten-year production license with the government of Gabon, the Company agreed in principle to a cash funding arrangement for the eventual abandonment of the offshore wells, platforms and facilities. The agreement is not yet finalized, but calls for annual funding for the next seven years at 12.14% of the total abandonment estimate per year and 5.0%&#xA0;per year for the last three years of the production license. The amounts paid will be reimbursed through the cost account and are non-refundable to the Company. The funding will begin after the agreement is finalized. The abandonment estimate for this purpose is approximately $10.1 million net to the Company on an undiscounted basis. The obligation for abandonment of the Gabon offshore facilities is included in the asset retirement obligation shown on the Company&#x2019;s balance sheet.</font></p> <p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2"><u>Angola</u></font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In November 2006, the Company signed a production sharing contract for Block 5 offshore Angola. The four year primary term with an optional three year extension awards the Company exploration rights to 1.4&#xA0;million acres offshore central Angola. The Company&#x2019;s working interest is 40%. Additionally, the Company is required to carry the Angolan national oil company, Sonangol P&amp;P, for 10% of the work program. During the first four years of the contract, the Company was required to acquire and process 1,000 square kilometers of 3-D seismic data, drill two exploration wells and expend a minimum of $29.5 million ($14.8 million net to the Company). The Company fulfilled its seismic obligation when it acquired 1,175 square kilometers of 3-D seismic data at a cost of $7.5 million ($3.75 million net to the Company) in January 2007 and 524 square kilometers of 3-D seismic data during the fourth quarter of 2008 at a cost of $6.0 million ($3.0 million net to the Company). Each of the two exploration commitment wells is subject to a $5.0 million penalty ($10.0 million in aggregate for both wells) if not drilled during the contract term. The $10.0 million is currently recorded as restricted cash and is held at a financial institution located in the United States. Additional time extensions have been granted by the Angolan government to drill the two exploration commitment wells, the latest extension providing until November&#xA0;30, 2014.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; FONT-SIZE: 1px"> &#xA0;</p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The government-assigned working interest partner was delinquent paying their share of the costs several times in 2009 and consequently was placed in a default position. By a governmental decree, dated December&#xA0;1, 2010, the former partner was removed from the production sharing contract. Following the decree, the Company and the government of Angola have been working together to obtain a replacement partner.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the second quarter of 2012, the Company identified a potential partner to acquire the available 40% working interest and submitted the name of the interested party to the Angolan government for approval. In July 2013, the Angolan government informed the Company that it should first proceed to acquire the available working interest per the provisions of the Joint Operating Agreement and then enter into a farm-out agreement with the potential partner. The Company is working to accomplish the two-step process outlined by the Angolan government. The Company cannot provide a time estimate for completing these activities as it involves actions by the Angolan government as well as the potential partner.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">Due to the continuing circumstances regarding the available 40% working interest, the Company has recorded a full allowance totaling $7.2 million as of June&#xA0;30, 2013, against the accounts receivable from partners for the amounts owed to the Company above its 40% working interest plus the 10% carried interest. The allowance recorded in the three and six months ended June&#xA0;30, 2013 totaled $0.3 million and $1.1 million, respectively. The farm-out agreement, to be executed by the counterparty, provides for the Company to be reimbursed for the gross receivable amount. The timing of this event cannot be reasonably predicted at the present time.</font></p> </div> <div> <p><font size="2">Segment activity for the three months and six months ended June&#xA0;30, 2013 and 2012 are as follows:</font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px"> &#xA0;</p> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <!-- Begin Table Head --> <tr> <td width="56%"></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <!-- End Table Head --><!-- Begin Table Body --> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Three months ended June&#xA0;30,</b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2013</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">28,574</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">544</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">29,118</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">14,853</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(379</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(165</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,336</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,307</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">11,666</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2012</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,886</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">932</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,818</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">45,258</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(585</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3,843</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(2,198</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">38,632</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td height="16"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> </tr> <tr> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate<br /> and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Six months ended June&#xA0;30,</b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2013</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">72,229</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,026</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">73,255</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">45,717</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,582</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(455</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(7,028</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3,482</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">33,170</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><u><b>2012</b></u></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">102,613</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,491</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">104,104</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">79,605</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,199</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(4,606</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(5,061</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">68,739</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td height="16"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> </tr> <tr> <td valign="bottom"> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Total Assets</b></font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 1px"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate<br /> and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">As of June&#xA0;30, 2013</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">208,545</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">12,126</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">10,010</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">14,696</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">26,846</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">272,223</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">As of December&#xA0;31, 2012</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">190,652</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">11,405</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">10,000</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">17,314</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">38,585</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">267,956</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <!-- End Table Body --></table> </div> 0.24 58785808 <div> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">A summary of the stock option activity for the six months ended June&#xA0;30, 2013 is provided below:</font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px"> &#xA0;</p> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="92%" align="center"> <tr> <td width="51%"></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Number&#xA0;of&#xA0; Shares</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Underlying&#xA0;Options</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">(in thousands)</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Weighted<br /> Average&#xA0;Exercise<br /> Price Per Share</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Weighted</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Average</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Remaining</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Contractual</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Term</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Aggregate</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Intrinsic&#xA0; Value<br /> (in millions)</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Outstanding at beginning of period</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4,065</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.12</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.65</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Granted</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,236</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">7.59</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4.71</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Exercised</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(32</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4.24</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">0.28</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Forfeited</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Outstanding at end of period</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">5,269</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.47</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.77</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.62</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Exercisable at end of period</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4,386</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.15</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.45</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.62</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> </tr> </table> </div> 0.25 P2Y9M7D 5.74 <div> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="4%" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">6.</font></td> <td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">REPURCHASE OF COMMON STOCK</font></td> </tr> </table> <!-- xbrl,body --> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">On June&#xA0;6, 2013, the Company announced that its Board of Directors has authorized the repurchase of up to $25 million of the Company&#x2019;s common stock over the next 12 months. Under the share buyback program, shares of common stock will be purchased on the open market or through privately negotiated transactions from time-to-time. The share buyback program does not obligate the Company to acquire any specific number of shares in any period, and may be modified, suspended, extended or discontinued at any time without prior notice. During the quarter ended June&#xA0;30, 2013, the Company repurchased 233,400 shares at an average price of $5.74 per share totaling $1.3 million.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">As of August&#xA0;1, 2013, the Company repurchased an additional 1,125,706 shares bringing the total amount of shares repurchased in this program to 1,359,106 shares. The average price paid for all shares was $6.00 per share totaling $8.2 million.</font></p> </div> <div> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="4%" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">5.</font></td> <td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">CAPITALIZATION OF EXPLORATORY WELL COSTS</font></td> </tr> </table> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">ASC Topic 932&#x2014;Extractive Industries provides that an exploratory well shall be capitalized as part of the entity&#x2019;s uncompleted wells pending the determination of whether the well has found proved reserves. Further, an exploration well that discovers oil and gas reserves, but those reserves cannot be classified as proved when drilling is completed, shall be capitalized if the well has found a sufficient quantity of reserves to justify its completion as a producing well and the entity is making sufficient progress assessing the reserves and the economic and operating viability of the project. If either condition is not met, the exploration well would be assumed to be impaired and its costs would be charged to expense.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the second and third quarters of 2010, the Company drilled the Southeast Etame No.&#xA0;1 well with two sidetracks in the Etame Marin block offshore Gabon. The well discovered a five meter column of oil in the Gamba sand reservoir. Additional evaluation of the well and sidetrack information was conducted to determine options for developing the discovery. In the second quarter of 2012, the Company and its partners agreed to proceed with the development plan featuring a fixed leg platform for developing the Southeast Etame discovery area and the North Tchibala field, where a discovery was made on the block prior to VAALCO&#x2019;s block participation. The final investment decision was approved in the fourth quarter of 2012 for the construction of the platform. Construction began in the first quarter of 2013 and the platform is expected to be transported and installed in the first half of 2014. The Company has capitalized $8.1 million for this well in accordance with the criteria contained in ASC Topic 932.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; FONT-SIZE: 1px"> &#xA0;</p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the third and fourth quarters of 2012, the Company drilled the N&#x2019;Gongui No.&#xA0;2 well with three sidetracks in the Mutamba Iroru block onshore Gabon. Application of the discovery was made timely to the government of Gabon, but the permit has yet to be issued. The Company has capitalized $7.9 million for this well in accordance with the criteria contained in ASC Topic 932.</font></p> </div> P3Y 7.59 881937 233400 -9545000 4.24 1236000 P1Y4M24D 57903871 P2Y5M12D <div> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="4%" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">2.</font></td> <td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">EARNINGS PER SHARE</font></td> </tr> </table> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">Basic earnings per share (&#x201C;EPS&#x201D;) is calculated using the average number of shares of common stock outstanding during each period. Diluted EPS assumes the exercise of all stock options having exercise prices less than the average market price of the common stock using the treasury stock method.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">Diluted shares consist of the following:</font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px"> &#xA0;</p> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="92%" align="center"> <tr> <td width="56%"></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Three months ended,</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Six months ended,</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">June&#xA0;30,&#xA0;2013</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">June&#xA0;30,&#xA0;2012</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">June&#xA0;30,&#xA0;2013</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">June&#xA0;30,&#xA0;2012</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Basic weighted average common stock issued and outstanding</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,900,809</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,797,484</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,903,871</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,496,261</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Dilutive options</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">659,475</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,202,808</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">881,937</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,204,568</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Total dilutive shares</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,560,284</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">59,000,292</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,785,808</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,700,829</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> </tr> </table> <p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; FONT-SIZE: 1px"> &#xA0;</p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">Options to purchase 3,205,865 and 2,135,300 shares were excluded in the three months and six months ended June&#xA0;30, 2013, respectively, because they would have been anti-dilutive. Options to purchase 1,018,900 and 1,018,900 shares were excluded in the three months and six months ended June&#xA0;30, 2012, respectively, because they would have been anti-dilutive.</font></p> </div> 32000 <div> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="4%" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">1.</font></td> <td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND ACCOUNTING POLICIES</font></td> </tr> </table> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The condensed consolidated financial statements of VAALCO Energy, Inc. and subsidiaries (collectively, &#x201C;VAALCO&#x201D; or the &#x201C;Company&#x201D;), included herein are unaudited, but include all adjustments consisting of normal recurring accruals which the Company deems necessary for a fair presentation of its financial position, results of operations and cash flows for the interim period. Such results are not necessarily indicative of results to be expected for the full year. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company&#x2019;s Form 10-K for the year ended December&#xA0;31, 2012, which also contains a summary of the significant accounting policies followed by the Company in the preparation of its consolidated financial statements. These policies were also followed in preparing the quarterly report included herein. The Company follows the successful efforts method of accounting for oil and gas exploration and development costs.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">VAALCO is a Houston-based independent energy company, principally engaged in the acquisition, exploration, development and production of crude oil and natural gas. VAALCO owns producing properties and conducts exploration activities as an operator in Gabon, West Africa, conducts exploration activities as an operator in Angola, West Africa, and conducts exploration activities as a non-operator in Equatorial Guinea, West Africa. VAALCO is the operator of unconventional and conventional resource properties in the United States located in Montana and North Texas. The Company also owns minor interests in conventional production activities as a non-operator in the United States.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">VAALCO&#x2019;s international subsidiaries are VAALCO Gabon (Etame), Inc., VAALCO Production (Gabon), Inc., VAALCO Angola (Kwanza), Inc., VAALCO UK (North Sea), Ltd., VAALCO International, Inc., VAALCO Energy (EG), Inc. and VAALCO Energy Mauritius (EG) Limited. VAALCO Energy (USA), Inc. holds interests in properties located in the United States.</font></p> </div> 2135300 <div> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">Diluted shares consist of the following:</font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px"> &#xA0;</p> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="92%" align="center"> <tr> <td width="56%"></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Three months ended,</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Six months ended,</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">June&#xA0;30,&#xA0;2013</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">June&#xA0;30,&#xA0;2012</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">June&#xA0;30,&#xA0;2013</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">June&#xA0;30,&#xA0;2012</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Basic weighted average common stock issued and outstanding</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,900,809</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,797,484</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,903,871</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,496,261</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Dilutive options</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">659,475</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,202,808</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">881,937</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,204,568</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Total dilutive shares</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,560,284</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">59,000,292</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,785,808</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,700,829</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 3px double">&#xA0;</p> </td> <td>&#xA0;</td> </tr> </table> </div> 1166000 20010000 3306000 11238000 305000 -96000 18416000 41000 14310000 33170000 73255000 -22000 33115000 18266000 40833000 -55000 14310000 25000000 0 1339000 1944000 135000 510000 1848000 40085000 6102000 -1204000 1339000 2238000 1141000 -52092000 10386000 135000 -41343000 8836000 7057000 15399000 18805000 P3M11D P4Y8M16D P5Y <div> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">ASC Topic 932&#x2014;Extractive Industries provides that an exploratory well shall be capitalized as part of the entity&#x2019;s uncompleted wells pending the determination of whether the well has found proved reserves. Further, an exploration well that discovers oil and gas reserves, but those reserves cannot be classified as proved when drilling is completed, shall be capitalized if the well has found a sufficient quantity of reserves to justify its completion as a producing well and the entity is making sufficient progress assessing the reserves and the economic and operating viability of the project. If either condition is not met, the exploration well would be assumed to be impaired and its costs would be charged to expense.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the second and third quarters of 2010, the Company drilled the Southeast Etame No.&#xA0;1 well with two sidetracks in the Etame Marin block offshore Gabon. The well discovered a five meter column of oil in the Gamba sand reservoir. Additional evaluation of the well and sidetrack information was conducted to determine options for developing the discovery. In the second quarter of 2012, the Company and its partners agreed to proceed with the development plan featuring a fixed leg platform for developing the Southeast Etame discovery area and the North Tchibala field, where a discovery was made on the block prior to VAALCO&#x2019;s block participation. The final investment decision was approved in the fourth quarter of 2012 for the construction of the platform. Construction began in the first quarter of 2013 and the platform is expected to be transported and installed in the first half of 2014. The Company has capitalized $8.1 million for this well in accordance with the criteria contained in ASC Topic 932.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; FONT-SIZE: 1px"> &#xA0;</p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the third and fourth quarters of 2012, the Company drilled the N&#x2019;Gongui No.&#xA0;2 well with three sidetracks in the Mutamba Iroru block onshore Gabon. Application of the discovery was made timely to the government of Gabon, but the permit has yet to be issued. 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Segment Information (Tables)
6 Months Ended
Jun. 30, 2013
Segment Reporting [Abstract]  
Segment Activity

Segment activity for the three months and six months ended June 30, 2013 and 2012 are as follows:

 

($ thousands)    Gabon      Angola     EG     USA     Corporate
and Other
    Total  

Three months ended June 30,

             

2013

             

Revenues

   $ 28,574       $ —        $ —        $ 544      $ —        $ 29,118   

Income from operations

     14,853         (379     (165     (1,336     (1,307     11,666   

2012

             

Revenues

   $ 57,886       $ —        $ —        $ 932      $ —        $ 58,818   

Income from operations

     45,258         (585     —          (3,843     (2,198     38,632   
($ thousands)    Gabon      Angola     EG     USA     Corporate
and Other
    Total  

Six months ended June 30,

             

2013

             

Revenues

   $ 72,229       $ —        $ —        $ 1,026      $ —        $ 73,255   

Income from operations

     45,717         (1,582     (455     (7,028     (3,482     33,170   

2012

             

Revenues

   $ 102,613       $ —        $ —        $ 1,491        $ 104,104   

Income from operations

     79,605         (1,199     —          (4,606     (5,061     68,739   

Total Assets

($ thousands)

   Gabon      Angola     EG     USA     Corporate
and Other
    Total  

As of June 30, 2013

   $ 208,545       $ 12,126      $ 10,010      $ 14,696      $ 26,846      $ 272,223   

As of December 31, 2012

     190,652         11,405        10,000        17,314        38,585        267,956   
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CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS (Unaudited) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2013
Jun. 30, 2012
Jun. 30, 2013
Jun. 30, 2012
Revenues:        
Oil and gas sales $ 29,118 $ 58,818 $ 73,255 $ 104,104
Operating costs and expenses:        
Production expenses 7,015 6,537 15,399 12,063
Exploration expense 4,280 3,484 10,386 4,337
Depreciation, depletion and amortization 3,431 6,850 7,057 11,854
General and administrative expenses 2,464 3,040 6,102 6,521
Bad debt expenses 262 275 1,141 590
Total operating costs and expenses 17,452 20,186 40,085 35,365
Operating income 11,666 38,632 33,170 68,739
Other income (expense):        
Interest income 16 32 41 73
Other, net (2) 382 (96) 583
Total other income (expense) 14 414 (55) 656
Income before income taxes 11,680 39,046 33,115 69,395
Income tax expense 4,559 26,729 18,805 46,549
Net income 7,121 12,317 14,310 22,846
Less net income attributable to noncontrolling interest   (1,893)   (3,402)
Net income attributable to VAALCO Energy, Inc. $ 7,121 $ 10,424 $ 14,310 $ 19,444
Basic net income attributable to VAALCO Energy, Inc. common shareholders $ 0.12 $ 0.18 $ 0.25 $ 0.34
Diluted net income attributable to VAALCO Energy, Inc. common shareholders $ 0.12 $ 0.18 $ 0.24 $ 0.33
Basic weighted shares outstanding 57,900,809 57,797,484 57,903,871 57,496,261
Diluted weighted shares outstanding 58,560,284 59,000,292 58,785,808 58,700,829
XML 16 R10.htm IDEA: XBRL DOCUMENT v2.4.0.8
Commitments and Contingencies
6 Months Ended
Jun. 30, 2013
Commitments And Contingencies Disclosure [Abstract]  
Commitments and Contingencies
4. COMMITMENTS AND CONTINGENCIES

Offshore Gabon

The Company entered into a sixth exploration period extension during 2009 and is required to spend $5.3 million for its share of two exploration wells and to acquire and process 150 square kilometers of 3-D seismic on the Etame Marin block by July 2014. One of the two exploration commitment wells was drilled in 2010 on the Omangou prospect at a cost of $8.6 million ($2.6 million net to the Company). The seismic obligation was met with the acquisition of 223 square kilometers of 3-D seismic in 2012. The remaining obligation is the drilling of one exploration well which is scheduled to be drilled in the third quarter of 2013. The well to be drilled is the Ovoka 1 well located approximately 5 miles northeast of the Ebouri field and 6 miles north of the Etame field.

As part of securing the second ten-year production license with the government of Gabon, the Company agreed in principle to a cash funding arrangement for the eventual abandonment of the offshore wells, platforms and facilities. The agreement is not yet finalized, but calls for annual funding for the next seven years at 12.14% of the total abandonment estimate per year and 5.0% per year for the last three years of the production license. The amounts paid will be reimbursed through the cost account and are non-refundable to the Company. The funding will begin after the agreement is finalized. The abandonment estimate for this purpose is approximately $10.1 million net to the Company on an undiscounted basis. The obligation for abandonment of the Gabon offshore facilities is included in the asset retirement obligation shown on the Company’s balance sheet.

Angola

In November 2006, the Company signed a production sharing contract for Block 5 offshore Angola. The four year primary term with an optional three year extension awards the Company exploration rights to 1.4 million acres offshore central Angola. The Company’s working interest is 40%. Additionally, the Company is required to carry the Angolan national oil company, Sonangol P&P, for 10% of the work program. During the first four years of the contract, the Company was required to acquire and process 1,000 square kilometers of 3-D seismic data, drill two exploration wells and expend a minimum of $29.5 million ($14.8 million net to the Company). The Company fulfilled its seismic obligation when it acquired 1,175 square kilometers of 3-D seismic data at a cost of $7.5 million ($3.75 million net to the Company) in January 2007 and 524 square kilometers of 3-D seismic data during the fourth quarter of 2008 at a cost of $6.0 million ($3.0 million net to the Company). Each of the two exploration commitment wells is subject to a $5.0 million penalty ($10.0 million in aggregate for both wells) if not drilled during the contract term. The $10.0 million is currently recorded as restricted cash and is held at a financial institution located in the United States. Additional time extensions have been granted by the Angolan government to drill the two exploration commitment wells, the latest extension providing until November 30, 2014.

 

The government-assigned working interest partner was delinquent paying their share of the costs several times in 2009 and consequently was placed in a default position. By a governmental decree, dated December 1, 2010, the former partner was removed from the production sharing contract. Following the decree, the Company and the government of Angola have been working together to obtain a replacement partner.

In the second quarter of 2012, the Company identified a potential partner to acquire the available 40% working interest and submitted the name of the interested party to the Angolan government for approval. In July 2013, the Angolan government informed the Company that it should first proceed to acquire the available working interest per the provisions of the Joint Operating Agreement and then enter into a farm-out agreement with the potential partner. The Company is working to accomplish the two-step process outlined by the Angolan government. The Company cannot provide a time estimate for completing these activities as it involves actions by the Angolan government as well as the potential partner.

Due to the continuing circumstances regarding the available 40% working interest, the Company has recorded a full allowance totaling $7.2 million as of June 30, 2013, against the accounts receivable from partners for the amounts owed to the Company above its 40% working interest plus the 10% carried interest. The allowance recorded in the three and six months ended June 30, 2013 totaled $0.3 million and $1.1 million, respectively. The farm-out agreement, to be executed by the counterparty, provides for the Company to be reimbursed for the gross receivable amount. The timing of this event cannot be reasonably predicted at the present time.

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Repurchase of Common Stock - Additional Information (Detail) (USD $)
6 Months Ended 1 Months Ended
Jun. 30, 2013
Dec. 31, 2012
Aug. 01, 2013
Subsequent Event [Member]
Equity, Class of Treasury Stock [Line Items]      
Common stock authorized to be repurchased over the next 12 months $ 25,000,000    
Shares repurchased 233,400   1,359,106
Average price per share $ 5.74   $ 6.00
Common stock repurchased, value $ 25,314,000 $ 23,975,000 $ 8,200,000
Shares repurchased     1,125,706
XML 19 R18.htm IDEA: XBRL DOCUMENT v2.4.0.8
Earnings Per Share - Schedule of Diluted shares (Detail)
3 Months Ended 6 Months Ended
Jun. 30, 2013
Jun. 30, 2012
Jun. 30, 2013
Jun. 30, 2012
Weighted Average Number Of Shares Outstanding [Abstract]        
Basic weighted average common stock issued and outstanding 57,900,809 57,797,484 57,903,871 57,496,261
Dilutive options 659,475 1,202,808 881,937 1,204,568
Total dilutive shares 58,560,284 59,000,292 58,785,808 58,700,829
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In general, stock options granted will become exercisable over a period determined by the Compensation Committee which in the past has been a five year life. A portion of the stock options granted in March 2013 and 2012 vested immediately with the remainder vesting over a two year period. In addition, stock options will become exercisable upon a change in control, unless provided otherwise by the Compensation Committee. At June&#xA0;30, 2013, there were 2,127,046 shares subject to options authorized but not granted.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">For the three months and six months ended June&#xA0;30, 2013, the Company recognized non-cash compensation expense of $0.8 million and $2.2 million, respectively, related to stock options. For the three months and six months ended June&#xA0;30, 2012, the Company recognized non-cash compensation expense of $0.4 million and $1.7 million, respectively, related to stock options. These amounts were recorded as general and administrative expense. 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Shares</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Underlying&#xA0;Options</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">(in thousands)</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Weighted<br /> Average&#xA0;Exercise<br /> Price Per Share</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Weighted</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Average</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Remaining</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Contractual</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Term</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Aggregate</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Intrinsic&#xA0; Value<br /> (in millions)</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Outstanding at beginning of period</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4,065</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.12</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.65</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; 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Under the share buyback program, shares of common stock will be purchased on the open market or through privately negotiated transactions from time-to-time. The share buyback program does not obligate the Company to acquire any specific number of shares in any period, and may be modified, suspended, extended or discontinued at any time without prior notice. During the quarter ended June&#xA0;30, 2013, the Company repurchased 233,400 shares at an average price of $5.74 per share totaling $1.3 million.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">As of August&#xA0;1, 2013, the Company repurchased an additional 1,125,706 shares bringing the total amount of shares repurchased in this program to 1,359,106 shares. 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Segment Information - Segment Activity (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2013
Jun. 30, 2012
Jun. 30, 2013
Jun. 30, 2012
Dec. 31, 2012
Segment Reporting Information [Line Items]          
Revenues, Net $ 29,118 $ 58,818 $ 73,255 $ 104,104  
Income from operations 11,666 38,632 33,170 68,739  
Total assets 272,223   272,223   267,956
Operating Segments [Member] | Corporate and Other [Member]
         
Segment Reporting Information [Line Items]          
Revenues, Net             
Income from operations (1,307) (2,198) (3,482) (5,061)  
Total assets 26,846   26,846   38,585
Operating Segments [Member] | Gabon [Member]
         
Segment Reporting Information [Line Items]          
Revenues, Net 28,574 57,886 72,229 102,613  
Income from operations 14,853 45,258 45,717 79,605  
Total assets 208,545   208,545   190,652
Operating Segments [Member] | Angola [Member]
         
Segment Reporting Information [Line Items]          
Revenues, Net              
Income from operations (379) (585) (1,582) (1,199)  
Total assets 12,126   12,126   11,405
Operating Segments [Member] | Equatorial Guinea [Member]
         
Segment Reporting Information [Line Items]          
Revenues, Net              
Income from operations (165)    (455)     
Total assets 10,010   10,010   10,000
Operating Segments [Member] | USA [Member]
         
Segment Reporting Information [Line Items]          
Revenues, Net 544 932 1,026 1,491  
Income from operations (1,336) (3,843) (7,028) (4,606)  
Total assets $ 14,696   $ 14,696   $ 17,314

XML 26 R6.htm IDEA: XBRL DOCUMENT v2.4.0.8
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (Unaudited) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Jun. 30, 2013
Jun. 30, 2012
CASH FLOWS FROM OPERATING ACTIVITIES    
Net income $ 14,310 $ 22,846
Adjustments to reconcile net income to net cash provided by operating activities    
Depreciation, depletion and amortization 7,057 11,854
Unrealized foreign exchange loss (gain) 22 (358)
Dry hole costs 8,836 2,853
Stock based compensation 2,238 1,704
Bad debt expense 1,141 590
Change in operating assets and liabilities:    
Trade receivables (18,266) (9,904)
Accounts with partners (20,010) 6,077
Other receivables (3,306) (1,061)
Crude oil inventory (1,944) (437)
Materials and supplies (305) (180)
Prepayments and other (1,166) (1,594)
Accounts payable, accrued liabilities and other liabilities 1,848 (4,372)
Net cash provided by (used in) operating activities (9,545) 28,018
CASH FLOWS FROM INVESTING ACTIVITIES    
Restricted cash, net (510) 88
Property and equipment expenditures (40,833) (27,221)
Net cash used in investing activities (41,343) (27,133)
CASH FLOWS FROM FINANCING ACTIVITIES    
Proceeds from the issuance of common stock 135 3,369
Purchase of treasury stock (1,339)  
Distribution to noncontrolling interest   (3,597)
Net cash used in financing activities (1,204) (228)
NET CHANGE IN CASH AND CASH EQUIVALENTS (52,092) 657
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 130,800 137,139
CASH AND CASH EQUIVALENTS AT END OF PERIOD 78,708 137,796
Supplemental disclosure of cash flow information    
Income taxes paid 18,416 41,733
Supplemental disclosure of non cash transactions    
Property and equipment additions incurred during the period but not paid at period end 11,238 5,456
Property and equipment reductions as the result in changes in asset retirement cost estimates   $ 5,670
XML 27 R8.htm IDEA: XBRL DOCUMENT v2.4.0.8
Earnings Per Share
6 Months Ended
Jun. 30, 2013
Earnings Per Share [Abstract]  
Earnings Per Share
2. EARNINGS PER SHARE

Basic earnings per share (“EPS”) is calculated using the average number of shares of common stock outstanding during each period. Diluted EPS assumes the exercise of all stock options having exercise prices less than the average market price of the common stock using the treasury stock method.

Diluted shares consist of the following:

 

     Three months ended,      Six months ended,  
     June 30, 2013      June 30, 2012      June 30, 2013      June 30, 2012  

Basic weighted average common stock issued and outstanding

     57,900,809         57,797,484         57,903,871         57,496,261   

Dilutive options

     659,475         1,202,808         881,937         1,204,568   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total dilutive shares

     58,560,284         59,000,292         58,785,808         58,700,829   
  

 

 

    

 

 

    

 

 

    

 

 

 

 

Options to purchase 3,205,865 and 2,135,300 shares were excluded in the three months and six months ended June 30, 2013, respectively, because they would have been anti-dilutive. Options to purchase 1,018,900 and 1,018,900 shares were excluded in the three months and six months ended June 30, 2012, respectively, because they would have been anti-dilutive.

XML 28 R11.xml IDEA: Capitalization of Exploratory Well Costs 2.4.0.8112 - Disclosure - Capitalization of Exploratory Well Coststruefalsefalse1false falsefalseeol_PE4367----1310-Q0005_STD_181_20130630_0http://www.sec.gov/CIK0000894627duration2013-01-01T00:00:002013-06-30T00:00:001true 1us-gaap_InventoryDisclosureAbstractus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsexbrli:stringItemTypestringfalse02false 2us-gaap_InventoryDisclosureTextBlockus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalseterseLabel1falsefalsefalse00<div> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="4%" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">5.</font></td> <td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">CAPITALIZATION OF EXPLORATORY WELL COSTS</font></td> </tr> </table> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">ASC Topic 932&#x2014;Extractive Industries provides that an exploratory well shall be capitalized as part of the entity&#x2019;s uncompleted wells pending the determination of whether the well has found proved reserves. Further, an exploration well that discovers oil and gas reserves, but those reserves cannot be classified as proved when drilling is completed, shall be capitalized if the well has found a sufficient quantity of reserves to justify its completion as a producing well and the entity is making sufficient progress assessing the reserves and the economic and operating viability of the project. If either condition is not met, the exploration well would be assumed to be impaired and its costs would be charged to expense.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the second and third quarters of 2010, the Company drilled the Southeast Etame No.&#xA0;1 well with two sidetracks in the Etame Marin block offshore Gabon. The well discovered a five meter column of oil in the Gamba sand reservoir. Additional evaluation of the well and sidetrack information was conducted to determine options for developing the discovery. In the second quarter of 2012, the Company and its partners agreed to proceed with the development plan featuring a fixed leg platform for developing the Southeast Etame discovery area and the North Tchibala field, where a discovery was made on the block prior to VAALCO&#x2019;s block participation. The final investment decision was approved in the fourth quarter of 2012 for the construction of the platform. Construction began in the first quarter of 2013 and the platform is expected to be transported and installed in the first half of 2014. The Company has capitalized $8.1 million for this well in accordance with the criteria contained in ASC Topic 932.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; FONT-SIZE: 1px"> &#xA0;</p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the third and fourth quarters of 2012, the Company drilled the N&#x2019;Gongui No.&#xA0;2 well with three sidetracks in the Mutamba Iroru block onshore Gabon. Application of the discovery was made timely to the government of Gabon, but the permit has yet to be issued. The Company has capitalized $7.9 million for this well in accordance with the criteria contained in ASC Topic 932.</font></p> </div>falsefalsefalsenonnum:textBlockItemTypenaThe entire disclosure for inventory. 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Capitalization of Exploratory Well Costs
6 Months Ended
Jun. 30, 2013
Inventory Disclosure [Abstract]  
Capitalization of Exploratory Well Costs
5. CAPITALIZATION OF EXPLORATORY WELL COSTS

ASC Topic 932—Extractive Industries provides that an exploratory well shall be capitalized as part of the entity’s uncompleted wells pending the determination of whether the well has found proved reserves. Further, an exploration well that discovers oil and gas reserves, but those reserves cannot be classified as proved when drilling is completed, shall be capitalized if the well has found a sufficient quantity of reserves to justify its completion as a producing well and the entity is making sufficient progress assessing the reserves and the economic and operating viability of the project. If either condition is not met, the exploration well would be assumed to be impaired and its costs would be charged to expense.

In the second and third quarters of 2010, the Company drilled the Southeast Etame No. 1 well with two sidetracks in the Etame Marin block offshore Gabon. The well discovered a five meter column of oil in the Gamba sand reservoir. Additional evaluation of the well and sidetrack information was conducted to determine options for developing the discovery. In the second quarter of 2012, the Company and its partners agreed to proceed with the development plan featuring a fixed leg platform for developing the Southeast Etame discovery area and the North Tchibala field, where a discovery was made on the block prior to VAALCO’s block participation. The final investment decision was approved in the fourth quarter of 2012 for the construction of the platform. Construction began in the first quarter of 2013 and the platform is expected to be transported and installed in the first half of 2014. The Company has capitalized $8.1 million for this well in accordance with the criteria contained in ASC Topic 932.

 

In the third and fourth quarters of 2012, the Company drilled the N’Gongui No. 2 well with three sidetracks in the Mutamba Iroru block onshore Gabon. Application of the discovery was made timely to the government of Gabon, but the permit has yet to be issued. The Company has capitalized $7.9 million for this well in accordance with the criteria contained in ASC Topic 932.

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Further, an exploration well that discovers oil and gas reserves, but those reserves cannot be classified as proved when drilling is completed, shall be capitalized if the well has found a sufficient quantity of reserves to justify its completion as a producing well and the entity is making sufficient progress assessing the reserves and the economic and operating viability of the project. If either condition is not met, the exploration well would be assumed to be impaired and its costs would be charged to expense.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the second and third quarters of 2010, the Company drilled the Southeast Etame No.&#xA0;1 well with two sidetracks in the Etame Marin block offshore Gabon. The well discovered a five meter column of oil in the Gamba sand reservoir. Additional evaluation of the well and sidetrack information was conducted to determine options for developing the discovery. In the second quarter of 2012, the Company and its partners agreed to proceed with the development plan featuring a fixed leg platform for developing the Southeast Etame discovery area and the North Tchibala field, where a discovery was made on the block prior to VAALCO&#x2019;s block participation. The final investment decision was approved in the fourth quarter of 2012 for the construction of the platform. Construction began in the first quarter of 2013 and the platform is expected to be transported and installed in the first half of 2014. The Company has capitalized $8.1 million for this well in accordance with the criteria contained in ASC Topic 932.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; FONT-SIZE: 1px"> &#xA0;</p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the third and fourth quarters of 2012, the Company drilled the N&#x2019;Gongui No.&#xA0;2 well with three sidetracks in the Mutamba Iroru block onshore Gabon. Application of the discovery was made timely to the government of Gabon, but the permit has yet to be issued. 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Stock-Based Compensation
6 Months Ended
Jun. 30, 2013
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]  
Stock-Based Compensation
3. STOCK-BASED COMPENSATION

Stock options are granted under the Company’s long-term incentive plan and have an exercise price that may not be less than the fair market value of the underlying shares on the date of grant. In general, stock options granted will become exercisable over a period determined by the Compensation Committee which in the past has been a five year life. A portion of the stock options granted in March 2013 and 2012 vested immediately with the remainder vesting over a two year period. In addition, stock options will become exercisable upon a change in control, unless provided otherwise by the Compensation Committee. At June 30, 2013, there were 2,127,046 shares subject to options authorized but not granted.

For the three months and six months ended June 30, 2013, the Company recognized non-cash compensation expense of $0.8 million and $2.2 million, respectively, related to stock options. For the three months and six months ended June 30, 2012, the Company recognized non-cash compensation expense of $0.4 million and $1.7 million, respectively, related to stock options. These amounts were recorded as general and administrative expense. Because the Company does not pay significant United States federal income taxes, no amounts were recorded for tax benefits related to excess stock based compensation deductions.

A summary of the stock option activity for the six months ended June 30, 2013 is provided below:

 

     Number of  Shares
Underlying Options
(in thousands)
    Weighted
Average Exercise
Price Per Share
     Weighted
Average
Remaining
Contractual
Term
     Aggregate
Intrinsic  Value
(in millions)
 

Outstanding at beginning of period

     4,065      $ 6.12         2.65      

Granted

     1,236        7.59         4.71      

Exercised

     (32     4.24         0.28      

Forfeited

     —          —           —        
  

 

 

   

 

 

    

 

 

    

Outstanding at end of period

     5,269      $ 6.47         2.77       $ 6.62   
  

 

 

   

 

 

    

 

 

    

 

 

 

Exercisable at end of period

     4,386      $ 6.15         2.45       $ 6.62   
  

 

 

   

 

 

    

 

 

    

 

 

 

The intrinsic value of a stock option is the amount by which the current market value of the underlying stock exceeds the exercise price of the option.

 

As of June 30, 2013, unrecognized compensation costs totaled $1.7 million. The expense is expected to be recognized over a weighted average period of 1.4 years.

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The obligation for abandonment of the Gabon offshore facilities is included in the asset retirement obligation shown on the Company&#x2019;s balance sheet.</font></p> <p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2"><u>Angola</u></font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In November 2006, the Company signed a production sharing contract for Block 5 offshore Angola. The four year primary term with an optional three year extension awards the Company exploration rights to 1.4&#xA0;million acres offshore central Angola. The Company&#x2019;s working interest is 40%. Additionally, the Company is required to carry the Angolan national oil company, Sonangol P&amp;P, for 10% of the work program. During the first four years of the contract, the Company was required to acquire and process 1,000 square kilometers of 3-D seismic data, drill two exploration wells and expend a minimum of $29.5 million ($14.8 million net to the Company). The Company fulfilled its seismic obligation when it acquired 1,175 square kilometers of 3-D seismic data at a cost of $7.5 million ($3.75 million net to the Company) in January 2007 and 524 square kilometers of 3-D seismic data during the fourth quarter of 2008 at a cost of $6.0 million ($3.0 million net to the Company). Each of the two exploration commitment wells is subject to a $5.0 million penalty ($10.0 million in aggregate for both wells) if not drilled during the contract term. The $10.0 million is currently recorded as restricted cash and is held at a financial institution located in the United States. Additional time extensions have been granted by the Angolan government to drill the two exploration commitment wells, the latest extension providing until November&#xA0;30, 2014.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; FONT-SIZE: 1px"> &#xA0;</p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The government-assigned working interest partner was delinquent paying their share of the costs several times in 2009 and consequently was placed in a default position. By a governmental decree, dated December&#xA0;1, 2010, the former partner was removed from the production sharing contract. Following the decree, the Company and the government of Angola have been working together to obtain a replacement partner.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In the second quarter of 2012, the Company identified a potential partner to acquire the available 40% working interest and submitted the name of the interested party to the Angolan government for approval. In July 2013, the Angolan government informed the Company that it should first proceed to acquire the available working interest per the provisions of the Joint Operating Agreement and then enter into a farm-out agreement with the potential partner. The Company is working to accomplish the two-step process outlined by the Angolan government. The Company cannot provide a time estimate for completing these activities as it involves actions by the Angolan government as well as the potential partner.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">Due to the continuing circumstances regarding the available 40% working interest, the Company has recorded a full allowance totaling $7.2 million as of June&#xA0;30, 2013, against the accounts receivable from partners for the amounts owed to the Company above its 40% working interest plus the 10% carried interest. The allowance recorded in the three and six months ended June&#xA0;30, 2013 totaled $0.3 million and $1.1 million, respectively. The farm-out agreement, to be executed by the counterparty, provides for the Company to be reimbursed for the gross receivable amount. 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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) (USD $)
In Millions, except Share data, unless otherwise specified
Jun. 30, 2013
Dec. 31, 2012
Statement Of Financial Position [Abstract]    
Allowance for accounts with partners $ 7.2 $ 6.0
Common stock, par value $ 0.10 $ 0.10
Common stock, shares authorized 100,000,000 100,000,000
Common stock, shares issued 63,167,438 63,135,772
Treasury stock, shares 5,491,038 5,257,638
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Capitalization of Exploratory Well Costs (Policies)
6 Months Ended
Jun. 30, 2013
Inventory Disclosure [Abstract]  
Extractive Industries

ASC Topic 932—Extractive Industries provides that an exploratory well shall be capitalized as part of the entity’s uncompleted wells pending the determination of whether the well has found proved reserves. Further, an exploration well that discovers oil and gas reserves, but those reserves cannot be classified as proved when drilling is completed, shall be capitalized if the well has found a sufficient quantity of reserves to justify its completion as a producing well and the entity is making sufficient progress assessing the reserves and the economic and operating viability of the project. If either condition is not met, the exploration well would be assumed to be impaired and its costs would be charged to expense.

In the second and third quarters of 2010, the Company drilled the Southeast Etame No. 1 well with two sidetracks in the Etame Marin block offshore Gabon. The well discovered a five meter column of oil in the Gamba sand reservoir. Additional evaluation of the well and sidetrack information was conducted to determine options for developing the discovery. In the second quarter of 2012, the Company and its partners agreed to proceed with the development plan featuring a fixed leg platform for developing the Southeast Etame discovery area and the North Tchibala field, where a discovery was made on the block prior to VAALCO’s block participation. The final investment decision was approved in the fourth quarter of 2012 for the construction of the platform. Construction began in the first quarter of 2013 and the platform is expected to be transported and installed in the first half of 2014. The Company has capitalized $8.1 million for this well in accordance with the criteria contained in ASC Topic 932.

 

In the third and fourth quarters of 2012, the Company drilled the N’Gongui No. 2 well with three sidetracks in the Mutamba Iroru block onshore Gabon. Application of the discovery was made timely to the government of Gabon, but the permit has yet to be issued. The Company has capitalized $7.9 million for this well in accordance with the criteria contained in ASC Topic 932.

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Unaudited) (USD $)
In Thousands
Total
Common Stock
Additional Paid-In Capital
Retained Earnings
Treasury Stock
Noncontrolling Interest
Beginning Balance at Dec. 31, 2011 $ 233,067 $ 6,238 $ 66,122 $ 180,739 $ (23,975) $ 3,943
Proceeds from stock issuance 3,369 72 3,297      
Stock based compensation 1,704   1,704      
Net income 22,846     19,444   3,402
Distribution to noncontrolling interest (3,597)         (3,597)
Ending Balance at Jun. 30, 2012 257,389 6,310 71,123 200,183 (23,975) 3,748
Beginning Balance at Dec. 31, 2012 212,525 6,314 48,816 181,370 (23,975)  
Proceeds from stock issuance 135 3 132      
Stock based compensation 2,238   2,238      
Treasury stock purchase (1,339)       (1,339)  
Net income 14,310     14,310    
Ending Balance at Jun. 30, 2013 $ 227,869 $ 6,317 $ 51,186 $ 195,680 $ (25,314)  
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CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2013
Dec. 31, 2012
Current assets:    
Cash and cash equivalents $ 78,708 $ 130,800
Restricted cash 1,770 1,257
Receivables:    
Trade 26,227 7,961
Accounts with partners, net of allowance of $7.2 million and $6.0 million at June 30, 2013 and December 31, 2012, respectively 4,821 689
Other 7,688 4,463
Crude oil inventory 3,328 683
Materials and supplies 642 337
Prepayments and other 4,099 2,935
Total current assets 127,283 149,125
Property and equipment - successful efforts method:    
Wells, platforms and other production facilities 198,571 188,208
Undeveloped acreage 28,410 28,657
Work in progress 61,929 38,137
Equipment and other 7,221 7,574
Property, plant and equipment, gross, Total 296,131 262,576
Accumulated depreciation, depletion and amortization (163,411) (155,968)
Net property and equipment 132,720 106,608
Other assets:    
Deferred tax asset 1,349 1,349
Restricted cash 10,871 10,874
Total Assets 272,223 267,956
Current liabilities:    
Accounts payable and accrued liabilities 33,219 30,326
Accounts with partners   14,737
Total current liabilities 33,219 45,063
Asset retirement obligations 11,135 10,368
Total Liabilities 44,354 55,431
Commitments and Contingencies (Note 4)      
VAALCO Energy, Inc. shareholders' equity:    
Common stock, $0.10 par value, 100,000,000 authorized shares, 63,167,438 and 63,135,772 shares issued with 5,491,038 and 5,257,638 shares in treasury at June 30, 2013 and December 31, 2012, respectively 6,317 6,314
Additional paid-in capital 51,186 48,816
Retained earnings 195,680 181,370
Less treasury stock, at cost (25,314) (23,975)
Total VAALCO Energy, Inc. shareholders' equity 227,869 212,525
Total Liabilities and Equity $ 272,223 $ 267,956
XML 44 R7.xml IDEA: Unaudited Condensed Consolidated Financial Statements and Accounting Policies 2.4.0.8108 - Disclosure - Unaudited Condensed Consolidated Financial Statements and Accounting Policiestruefalsefalse1false falsefalseeol_PE4367----1310-Q0005_STD_181_20130630_0http://www.sec.gov/CIK0000894627duration2013-01-01T00:00:002013-06-30T00:00:001true 1us-gaap_AccountingPoliciesAbstractus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsexbrli:stringItemTypestringfalse02false 2us-gaap_SignificantAccountingPoliciesTextBlockus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalseterseLabel1falsefalsefalse00<div> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr> <td valign="top" width="4%" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">1.</font></td> <td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="2">UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND ACCOUNTING POLICIES</font></td> </tr> </table> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The condensed consolidated financial statements of VAALCO Energy, Inc. and subsidiaries (collectively, &#x201C;VAALCO&#x201D; or the &#x201C;Company&#x201D;), included herein are unaudited, but include all adjustments consisting of normal recurring accruals which the Company deems necessary for a fair presentation of its financial position, results of operations and cash flows for the interim period. Such results are not necessarily indicative of results to be expected for the full year. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company&#x2019;s Form 10-K for the year ended December&#xA0;31, 2012, which also contains a summary of the significant accounting policies followed by the Company in the preparation of its consolidated financial statements. These policies were also followed in preparing the quarterly report included herein. The Company follows the successful efforts method of accounting for oil and gas exploration and development costs.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">VAALCO is a Houston-based independent energy company, principally engaged in the acquisition, exploration, development and production of crude oil and natural gas. VAALCO owns producing properties and conducts exploration activities as an operator in Gabon, West Africa, conducts exploration activities as an operator in Angola, West Africa, and conducts exploration activities as a non-operator in Equatorial Guinea, West Africa. VAALCO is the operator of unconventional and conventional resource properties in the United States located in Montana and North Texas. The Company also owns minor interests in conventional production activities as a non-operator in the United States.</font></p> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">VAALCO&#x2019;s international subsidiaries are VAALCO Gabon (Etame), Inc., VAALCO Production (Gabon), Inc., VAALCO Angola (Kwanza), Inc., VAALCO UK (North Sea), Ltd., VAALCO International, Inc., VAALCO Energy (EG), Inc. and VAALCO Energy Mauritius (EG) Limited. VAALCO Energy (USA), Inc. holds interests in properties located in the United States.</font></p> </div>falsefalsefalsenonnum:textBlockItemTypenaThe entire disclosure for all significant accounting policies of the reporting entity.Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18780-107790 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18726-107790 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18861-107790 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18743-107790 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18854-107790 false0falseUnaudited Condensed Consolidated Financial Statements and Accounting PoliciesUnKnownUnKnownUnKnownUnKnowntruefalsefalseSheethttp://www.vaalco.com/taxonomy/role/NotesToFinancialStatementsSignificantAccountingPoliciesTextBlock12 XML 45 R17.xml IDEA: Segment Information (Tables) 2.4.0.8118 - Disclosure - Segment Information (Tables)truefalsefalse1false falsefalseeol_PE4367----1310-Q0005_STD_181_20130630_0http://www.sec.gov/CIK0000894627duration2013-01-01T00:00:002013-06-30T00:00:001true 1us-gaap_SegmentReportingAbstractus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsexbrli:stringItemTypestringfalse02false 2us-gaap_ScheduleOfRevenuesFromExternalCustomersAndLongLivedAssetsByGeographicalAreasTableTextBlockus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalseterseLabel1falsefalsefalse00<div> <p><font size="2">Segment activity for the three months and six months ended June&#xA0;30, 2013 and 2012 are as follows:</font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px"> &#xA0;</p> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <!-- Begin Table Head --> <tr> <td width="56%"></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="2%"></td> <td></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <!-- End Table Head --><!-- Begin Table Body --> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Three months ended June&#xA0;30,</b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2013</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">28,574</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">544</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">29,118</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">14,853</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(379</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(165</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,336</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,307</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">11,666</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2012</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,886</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">932</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,818</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">45,258</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(585</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3,843</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(2,198</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">38,632</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td height="16"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> </tr> <tr> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate<br /> and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Six months ended June&#xA0;30,</b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2013</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">72,229</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,026</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">73,255</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">45,717</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,582</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(455</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(7,028</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3,482</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">33,170</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><u><b>2012</b></u></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">102,613</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,491</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">104,104</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">79,605</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,199</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(4,606</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(5,061</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">68,739</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td height="16"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> </tr> <tr> <td valign="bottom"> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="1"><b>Total Assets</b></font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 1px"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate<br /> and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">As of June&#xA0;30, 2013</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">208,545</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">12,126</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">10,010</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">14,696</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">26,846</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">272,223</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">As of December&#xA0;31, 2012</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">190,652</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">11,405</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">10,000</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">17,314</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">38,585</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">267,956</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <!-- End Table Body --></table> </div>falsefalsefalsenonnum:textBlockItemTypenaTabular disclosure of information concerning material long-lived assets (excluding financial instruments, customer relationships with financial institutions, mortgage and other servicing rights, deferred policy acquisition costs, and deferred taxes assets) located in identified geographic areas and/or the amount of revenue from external customers attributed to that country from which revenue is material. An entity may also provide subtotals of geographic information about groups of countries.Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 225 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SX 210.5-03.1) -URI http://asc.fasb.org/extlink&oid=26872669&loc=d3e20235-122688 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 03 -Paragraph 1 -Article 5 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=6534315&loc=d3e9038-108599 false0falseSegment Information (Tables)UnKnownUnKnownUnKnownUnKnowntruefalsefalseSheethttp://www.vaalco.com/taxonomy/role/NotesToFinancialStatementsSegmentReportingDisclosureTextBlockTables12 XML 46 R16.xml IDEA: Stock-Based Compensation (Tables) 2.4.0.8117 - Disclosure - Stock-Based Compensation (Tables)truefalsefalse1false falsefalseeol_PE4367----1310-Q0005_STD_181_20130630_0http://www.sec.gov/CIK0000894627duration2013-01-01T00:00:002013-06-30T00:00:001true 1us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstractus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsexbrli:stringItemTypestringfalse02false 2us-gaap_ScheduleOfShareBasedCompensationStockOptionsActivityTableTextBlockus-gaap_truenadurationfalsefalsefalsefalsefalsefalsefalsefalseterseLabel1falsefalsefalse00<div> <p style="MARGIN-TOP: 6px; MARGIN-BOTTOM: 0px; MARGIN-LEFT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">A summary of the stock option activity for the six months ended June&#xA0;30, 2013 is provided below:</font></p> <p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px"> &#xA0;</p> <table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="92%" align="center"> <tr> <td width="51%"></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> <td valign="bottom" width="9%"></td> <td></td> <td></td> <td></td> </tr> <tr> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Number&#xA0;of&#xA0; Shares</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Underlying&#xA0;Options</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">(in thousands)</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Weighted<br /> Average&#xA0;Exercise<br /> Price Per Share</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Weighted</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Average</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Remaining</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Contractual</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Term</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Aggregate</font><br /> <font style="FONT-FAMILY: Times New Roman" size="1">Intrinsic&#xA0; Value<br /> (in millions)</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Outstanding at beginning of period</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4,065</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">6.12</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">2.65</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Granted</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,236</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">7.59</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4.71</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Exercised</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(32</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">4.24</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">0.28</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 3em"><font style="FONT-FAMILY: Times New Roman" size="2">Forfeited</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Outstanding at end of period</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font 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Capitalization of Exploratory Well Costs - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30, 2013
Mutamba Iroru [Member]
Track
Jun. 30, 2013
Etame Marin [Member]
m
Track
Jan. 30, 2013
North Tchibala [Member]
Jun. 30, 2013
Accounting Standards Update 2010-03 [Member]
Capitalized Costs Relating to Oil and Gas Producing Activities, by Geographic Area [Line Items]        
Accounting Standard Code for Extractive Industries followed for capitalization purposes - ASC Topic 932       ASC Topic 932-Extractive Industries provides that an exploratory well shall be capitalized as part of the entity’s uncompleted wells pending the determination of whether the well has found proved reserves. Further, an exploration well that discovers oil and gas reserves, but those reserves cannot be classified as proved when drilling is completed, shall be capitalized if the well has found a sufficient quantity of reserves to justify its completion as a producing well and the entity is making sufficient progress assessing the reserves and the economic and operating viability of the project. If either condition is not met, the exploration well would be assumed to be impaired and its costs would be charged to expense.
Number of side tracks 3 2    
Area of sand of oil   5    
Capitalization on development plan $ 7.9   $ 8.1  
XML 50 R13.htm IDEA: XBRL DOCUMENT v2.4.0.8
Segment Information
6 Months Ended
Jun. 30, 2013
Segment Reporting [Abstract]  
Segment Information
7. SEGMENT INFORMATION

The Company’s main operations are based in Gabon, Angola, Equatorial Guinea, and in the United States. Minor activities for the Company’s United Kingdom subsidiary is included in the “Corporate and Other” column in the table. Management reviews and evaluates the operation of each geographic segment separately. The operations of all segments include exploration for and production of hydrocarbons where commercial reserves have been found and developed. Revenues are based on the location of hydrocarbon production. The Company evaluates each segment based on income (loss) from operations. Segment activity for the three months and six months ended June 30, 2013 and 2012 are as follows:

 

($ thousands)    Gabon      Angola     EG     USA     Corporate
and Other
    Total  

Three months ended June 30,

             

2013

             

Revenues

   $ 28,574       $ —        $ —        $ 544      $ —        $ 29,118   

Income from operations

     14,853         (379     (165     (1,336     (1,307     11,666   

2012

             

Revenues

   $ 57,886       $ —        $ —        $ 932      $ —        $ 58,818   

Income from operations

     45,258         (585     —          (3,843     (2,198     38,632   
($ thousands)    Gabon      Angola     EG     USA     Corporate
and Other
    Total  

Six months ended June 30,

             

2013

             

Revenues

   $ 72,229       $ —        $ —        $ 1,026      $ —        $ 73,255   

Income from operations

     45,717         (1,582     (455     (7,028     (3,482     33,170   

2012

             

Revenues

   $ 102,613       $ —        $ —        $ 1,491        $ 104,104   

Income from operations

     79,605         (1,199     —          (4,606     (5,061     68,739   

Total Assets

($ thousands)

   Gabon      Angola     EG     USA     Corporate
and Other
    Total  

As of June 30, 2013

   $ 208,545       $ 12,126      $ 10,010      $ 14,696      $ 26,846      $ 272,223   

As of December 31, 2012

     190,652         11,405        10,000        17,314        38,585        267,956   
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Stock-Based Compensation (Tables)
6 Months Ended
Jun. 30, 2013
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]  
Stock Option Activity

A summary of the stock option activity for the six months ended June 30, 2013 is provided below:

 

     Number of  Shares
Underlying Options
(in thousands)
    Weighted
Average Exercise
Price Per Share
     Weighted
Average
Remaining
Contractual
Term
     Aggregate
Intrinsic  Value
(in millions)
 

Outstanding at beginning of period

     4,065      $ 6.12         2.65      

Granted

     1,236        7.59         4.71      

Exercised

     (32     4.24         0.28      

Forfeited

     —          —           —        
  

 

 

   

 

 

    

 

 

    

Outstanding at end of period

     5,269      $ 6.47         2.77       $ 6.62   
  

 

 

   

 

 

    

 

 

    

 

 

 

Exercisable at end of period

     4,386      $ 6.15         2.45       $ 6.62   
  

 

 

   

 

 

    

 

 

    

 

 

 
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Repurchase of Common Stock
6 Months Ended
Jun. 30, 2013
Equity [Abstract]  
Repurchase of Common Stock
6. REPURCHASE OF COMMON STOCK

On June 6, 2013, the Company announced that its Board of Directors has authorized the repurchase of up to $25 million of the Company’s common stock over the next 12 months. Under the share buyback program, shares of common stock will be purchased on the open market or through privately negotiated transactions from time-to-time. The share buyback program does not obligate the Company to acquire any specific number of shares in any period, and may be modified, suspended, extended or discontinued at any time without prior notice. During the quarter ended June 30, 2013, the Company repurchased 233,400 shares at an average price of $5.74 per share totaling $1.3 million.

As of August 1, 2013, the Company repurchased an additional 1,125,706 shares bringing the total amount of shares repurchased in this program to 1,359,106 shares. The average price paid for all shares was $6.00 per share totaling $8.2 million.

XML 55 R7.htm IDEA: XBRL DOCUMENT v2.4.0.8
Unaudited Condensed Consolidated Financial Statements and Accounting Policies
6 Months Ended
Jun. 30, 2013
Accounting Policies [Abstract]  
Unaudited Condensed Consolidated Financial Statements and Accounting Policies
1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AND ACCOUNTING POLICIES

The condensed consolidated financial statements of VAALCO Energy, Inc. and subsidiaries (collectively, “VAALCO” or the “Company”), included herein are unaudited, but include all adjustments consisting of normal recurring accruals which the Company deems necessary for a fair presentation of its financial position, results of operations and cash flows for the interim period. Such results are not necessarily indicative of results to be expected for the full year. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Form 10-K for the year ended December 31, 2012, which also contains a summary of the significant accounting policies followed by the Company in the preparation of its consolidated financial statements. These policies were also followed in preparing the quarterly report included herein. The Company follows the successful efforts method of accounting for oil and gas exploration and development costs.

VAALCO is a Houston-based independent energy company, principally engaged in the acquisition, exploration, development and production of crude oil and natural gas. VAALCO owns producing properties and conducts exploration activities as an operator in Gabon, West Africa, conducts exploration activities as an operator in Angola, West Africa, and conducts exploration activities as a non-operator in Equatorial Guinea, West Africa. VAALCO is the operator of unconventional and conventional resource properties in the United States located in Montana and North Texas. The Company also owns minor interests in conventional production activities as a non-operator in the United States.

VAALCO’s international subsidiaries are VAALCO Gabon (Etame), Inc., VAALCO Production (Gabon), Inc., VAALCO Angola (Kwanza), Inc., VAALCO UK (North Sea), Ltd., VAALCO International, Inc., VAALCO Energy (EG), Inc. and VAALCO Energy Mauritius (EG) Limited. VAALCO Energy (USA), Inc. holds interests in properties located in the United States.

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MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Three months ended June&#xA0;30,</b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2013</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">28,574</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">544</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">29,118</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">14,853</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(379</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(165</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,336</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,307</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">11,666</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2012</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">57,886</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">932</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">58,818</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">45,258</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(585</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3,843</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(2,198</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">38,632</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td height="16"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> </tr> <tr> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="1"><i>($ thousands)</i></font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Gabon</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Angola</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">EG</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">USA</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Corporate<br /> and Other</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="1">Total</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Six months ended June&#xA0;30,</b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><b><u>2013</u></b></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">72,229</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,026</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">73,255</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">45,717</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,582</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(455</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(7,028</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(3,482</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">33,170</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2"><u><b>2012</b></u></font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> </tr> <tr> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Revenues</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">102,613</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,491</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">$</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">104,104</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Income from operations</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">79,605</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(1,199</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">&#x2014;&#xA0;&#xA0;</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(4,606</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">(5,061</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">)&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">68,739</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr> <td height="16"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> <td height="16" colspan="4"></td> </tr> <tr> <td valign="bottom"> <p style="MARGIN-TOP: 0px; 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Earnings Per Share - Additional Information (Detail)
3 Months Ended 6 Months Ended
Jun. 30, 2013
Jun. 30, 2012
Jun. 30, 2013
Jun. 30, 2012
Earnings Per Share [Abstract]        
Option to purchase shares, anti-dilutive 3,205,865 1,018,900 2,135,300 1,018,900
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Earnings Per Share (Tables)
6 Months Ended
Jun. 30, 2013
Earnings Per Share [Abstract]  
Schedule of Diluted Shares

Diluted shares consist of the following:

 

     Three months ended,      Six months ended,  
     June 30, 2013      June 30, 2012      June 30, 2013      June 30, 2012  

Basic weighted average common stock issued and outstanding

     57,900,809         57,797,484         57,903,871         57,496,261   

Dilutive options

     659,475         1,202,808         881,937         1,204,568   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total dilutive shares

     58,560,284         59,000,292         58,785,808         58,700,829   
  

 

 

    

 

 

    

 

 

    

 

 

 
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Commitments and Contingencies - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
6 Months Ended 1 Months Ended 3 Months Ended 6 Months Ended 48 Months Ended
Jun. 30, 2013
Well
Dec. 31, 2012
Jun. 30, 2013
Offshore Gabon [Member]
Sqkms
Well
Jan. 31, 2007
Angola [Member]
Sqkms
Nov. 30, 2006
Angola [Member]
Well
Jun. 30, 2013
Angola [Member]
Dec. 31, 2008
Angola [Member]
Sqkms
Jun. 30, 2013
Angola [Member]
acre
Nov. 01, 2010
Angola [Member]
Sqkms
Jun. 30, 2012
Angola [Member]
Long-term Purchase Commitment [Line Items]                    
Cost for acquire property     $ 5.3              
Length of acquired property     150              
Number of exploration wells     2   2          
Cost related to drilling     8.6              
Cost related to share of drilling     2.6              
Acquisition related to obligation     223              
Number of exploration wells drilling required to pay remaining obligation 1                  
Annual funding related to production license, term     7 years              
Percentage of annual funding over seven years     12.14%              
Percentage of annual funding over last three years     5.00%              
Abandonment cost related to annual funding     10.1              
Area under property exploration rights               1,400,000    
Joint operation agreement related to third party in working interest percentage           40.00%   40.00%    
Additional joint operation agreement related to third party in working interest percentage               10.00%    
Production license agreement term         4 years          
Production license agreement term extended by government         3 years          
Length of acquired data       1,175     524   1,000  
Drilling cost to company         14.8          
Seismic obligation cost to company       3.75     3.00      
Cost related to seismic obligation, gross       7.5     6.0      
Cost related to drilling         29.5          
Well penalty, minimum 5.0                  
Well penalty, maximum 10.0                  
Recorded restricted cash 10.0                  
Percentage of working interest for amounts owned           40.00%   40.00%   40.00%
Percentage of carried interest           10.00%   10.00%    
Full allowance against accounts receivable from partners 7.2 6.0                
Allowance recorded for accounts receivable with remainder           $ 0.3   $ 1.1    
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MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="2">Dilutive options</font></p> </td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">659,475</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,202,808</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">881,937</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> <td valign="bottom"><font size="1">&#xA0;&#xA0;</font></td> <td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;</font></td> <td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="2">1,204,568</font></td> <td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="2">&#xA0;&#xA0;</font></td> </tr> <tr style="FONT-SIZE: 1px"> <td valign="bottom"></td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> <td valign="bottom">&#xA0;&#xA0;</td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td valign="bottom"> <p style="BORDER-TOP: #000000 1px solid">&#xA0;</p> </td> <td>&#xA0;</td> </tr> <tr bgcolor="#CCEEFF"> <td valign="top"> <p style="TEXT-INDENT: -1em; 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Stock-Based Compensation - Additional Information (Detail) (USD $)
3 Months Ended 6 Months Ended
Jun. 30, 2013
Jun. 30, 2012
Jun. 30, 2013
Jun. 30, 2012
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]        
Stock options granted, exercisable life     5 years  
Stock options vesting period     3 years  
Stock options, authorized 2,127,046   2,127,046  
Non-cash compensation expense $ 800,000 $ 400,000 $ 2,238,000 $ 1,704,000
Tax benefits related to stock based compensation     0  
Unrecognized compensation costs $ 1,700,000   $ 1,700,000  
Compensation costs expected to be recognized     1 year 4 months 24 days  
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Document and Entity Information
6 Months Ended
Jun. 30, 2013
Jul. 31, 2013
Document Document And Entity Information [Abstract]    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Jun. 30, 2013  
Document Fiscal Year Focus 2013  
Document Fiscal Period Focus Q2  
Trading Symbol EGY  
Entity Registrant Name VAALCO ENERGY INC /DE/  
Entity Central Index Key 0000894627  
Current Fiscal Year End Date --12-31  
Entity Filer Category Accelerated Filer  
Entity Common Stock, Shares Outstanding   56,662,294
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Stock-Based Compensation - Stock Option Activity (Detail) (USD $)
In Millions, except Share data in Thousands, unless otherwise specified
6 Months Ended
Jun. 30, 2013
Dec. 31, 2012
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding [Roll Forward]    
Number of Shares Underlying Options, Outstanding at beginning of period 4,065  
Number of Shares Underlying Options, Granted 1,236  
Number of Shares Underlying Options, Exercised (32)  
Number of Shares Underlying Options, Forfeited     
Number of Shares Underlying Options, Outstanding at end of period 5,269 4,065
Number of Shares Underlying Options, Exercisable at end of period 4,386  
Weighted Average Exercise Price Per Share, Outstanding at beginning of period $ 6.12  
Weighted Average Exercise Price Per Share, Granted $ 7.59  
Weighted Average Exercise Price Per Share, Exercised $ 4.24  
Weighted Average Exercise Price Per Share, Forfeited     
Weighted Average Exercise Price Per Share, Outstanding at end of period $ 6.47 $ 6.12
Weighted Average Exercise Price Per Share, Exercisable at end of period $ 6.15  
Weighted Average Remaining Contractual Term, Granted 4 years 8 months 16 days  
Weighted Average Remaining Contractual Term, Exercised 3 months 11 days  
Weighted Average Remaining Contractual Term, Forfeited     
Weighted Average Remaining Contractual Term, Outstanding balance 2 years 9 months 7 days 2 years 7 months 24 days
Weighted Average Remaining Contractual Term, Exercisable at end of period 2 years 5 months 12 days  
Aggregate Intrinsic Value, Outstanding at end of period $ 6.62  
Aggregate Intrinsic Value, Exercisable at end of period $ 6.62  
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