Washington, D.C., June 13, 2005
— The International Finance Corporation, the private sector arm of the World Bank Group, is providing a $30 million revolving credit facility to VAALCO Gabon, a subsidiary of VAALCO Energy, a Houston-based oil and gas firm.
IFC’s investment will support the company’s multiyear oil exploration, development, and production programs in the Etame block, located 45 kilometers offshore in southern Gabon, helping sustain oil production there and the company’s efforts to find additional reserves. This is IFC’s second investment in the company. In 2002, IFC provided VAALCO Gabon a loan of $10 million to support the initial development of the Etame field.
Rashad Kaldany, IFC’s director for oil, gas, mining, and chemicals, noted, “VAALCO has shown a strong commitment to its project in Gabon. The company provides a good demonstration of successful foreign investment by smaller players in the country. IFC’s revolving credit facility will provide VAALCO Gabon with added financial flexibility in maintaining its investments to extend the life of oil reserves and production from its project.”
Richard Ranken, IFC’s director for Sub-Saharan Africa, added, “IFC is very pleased to support this project, which will help sustain Gabon's oil production and contribute to growth. Also, IFC's participation, with long-term financing not readily available in the local Gabonese market, is expected to help enhance VAALCO's environmental and social management systems.”
VAALCO Gabon is committed to sound environmental management and is working closely with IFC to integrate its existing environmental plans and procedures into a comprehensive environmental and social management system.
Russell Scheirman, president and chief financial officer of VAALCO Energy Inc., said, “The IFC facility was negotiated on a fast-track basis to provide financing for development of the discoveries that VAALCO made in Gabon during 2004. The revolving nature of the credit facility will allow the funds to be used on a recurring basis for each of the three projects on the Etame block, streamlining documentation requirements and reducing financing costs. We are pleased with the results of this financing project as we feel it creates a win-win situation for the company, the government of Gabon, and IFC.”
The mission of IFC (
www.ifc.org
) is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY04, IFC has committed more than $44 billion of its own funds and arranged $23 billion in syndications for 3,143 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY04 was $17.9 billion for its own account and $5.5 billion held for participants in loan syndications.
