Vaalco Energy, Inc. has entered into an agreement for a new revolving credit facility, with an initial commitment of $190 million and the possibility to increase it to $300 million. This financing facility, led by The Standard Bank of South Africa Limited, replaces a previously unused credit line provided by Glencore Energy UK Ltd. The primary purpose of the funding is to complement the company’s internal cash flows to support its investment projects and the management of its assets across its diverse operating sites.
Financing terms
The new credit facility has a six-year term, with repayments set to begin on September 30, 2026. Borrowed funds will bear interest at 6.5% plus the SOFR (Secured Overnight Financing Rate) until the completion of the FPSO (Floating Production Storage and Offloading) vessel renovation works in Côte d’Ivoire. After this stage, the interest rate will be reduced to 6% plus SOFR.
The financing also includes annual fees for undrawn amounts, of 35% of the margin rate for available amounts and 20% for unavailable amounts. A re-evaluation of the loan base will occur every six months. This credit line is secured by Vaalco’s assets in Gabon, Egypt, and Côte d’Ivoire.
Growth objectives and future projects
George Maxwell, CEO of Vaalco, emphasised that this credit facility is intended to support the company’s organic growth projects in the coming years. The company plans several strategic projects across its various sites, particularly in West Africa, in order to drive the expansion of its production. Maxwell expressed his gratitude towards the lenders, highlighting their support for the company and the strength of its asset portfolio.
