HOUSTON, Nov, 10 /PRNewswire-FirstCall/ -- VAALCO Energy, Inc. (NYSE: EGY - News) announced that for the third quarter of 2008, net income was $22.3 million or $0.38 per diluted share compared to $8.8 million or $0.15 per diluted share for the comparable period in 2007. Third quarter 2008 revenues were $55.5 million compared to $34.8 million in the third quarter of 2007. Discretionary cash flow was up 85% to $66.2 million for the nine months ended September 30, 2008 compared to $35.7 million in the same period of 2007. For the nine months ended September 30, 2008, net income was $37.2 million or $0.63 per diluted share compared to $17.1 million or $0.28 per diluted share in the nine months ended September 30, 2007.
"VAALCO's strong third quarter results reflect higher oil prices and crude volumes, as well as the expected benefit from a lower tax rate, attributable to increased capital expenditures during the quarter," said Robert L. Gerry, III, Chairman and CEO. "Our drilling and exploration program is continuing at one of the strongest rates in our history, with prospects in place to grow reserves and production. VAALCO's capital position remains strong, enabling us to capitalize on these opportunities."
As previously announced, VAALCO is planning seven additional development and exploration wells including a development well in the Ebouri field, three exploratory wells in the Etame block, two exploratory wells onshore Gabon in the Mutamba concession, one exploratory well in Angola, and a 25% interest in a gas prospect in the British North Sea. Together, these wells expose the Company to over 50 million net barrels, or an 8-fold potential increase to VAALCO's current 6.2 million barrels of proved reserves.
Earnings will of course be down significantly from here in Q4, as oil prices have had a steep drop, but if the company's current exploration program is even partially successful, it will be well-positioned when oil prices eventually resume their climb upward.