VAALCO Energy (NYSE:EGY) announced an agreement to divest its Canadian assets on Thursday, a strategic pivot that allows the Houston-based independent to concentrate capital on its high-margin drilling campaigns across Gabon and Egypt.
The company entered into a deal to sell its non-core producing properties in Canada for approximately $25.6 million (CAD $35 million).
The sale price represents 2.7 times the trailing 12-month operational cash flow for the assets, which currently produce roughly 1,850 barrels of oil equivalent per day (BOEPD).
The effective date of the transaction is Feb. 1, 2026, with a closing expected within the next 30 days.
CEO George Maxwell noted that the divestment follows a successful period in Canada, where the company generated CAD $82 million in operational cash flow since the assets were first acquired.
However, with major offshore projects gaining momentum in Africa—including a "Phase Three" drilling program in Gabon and a significant FPSO refurbishment in Côte d'Ivoire—VAALCO is streamlining its portfolio.
The sale does not impact the company’s borrowing base, leaving its liquidity intact as it scales up operations in the Eastern Desert of Egypt and the Etame field in Gabon.