The International Finance Corporation, the private sector arm of the World Bank Group, is providing a US$30mn 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 programmes in the Etame block, located 45km 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 US$10mn to support the initial development of the Etame field.

Rashad Kaldany, IFC’s director for oil, gas, mining, and chemicals, notes, “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 adds 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, adds, “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.