What changed in this filing

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Item 1A. Risk Factors

2025-03-17 compared with 2024-03-15 · 193 added, 223 removed, 466 unchanged (47% of the section changed)

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We are the operator of the Etame Marin block offshore Gabon, and are responsible for contracting on behalf of all the remaining parties participating in the project and rely on our joint venture owners to pay for 36.4% of the offshore Gabon budget.

With respect to Block P, the EG MMH approved our appointment as technical operator in August 2020 and, since we were appointed, we will rely on the timely payment of cash calls by our joint venture owners to pay for 46.3% of the Equatorial Guinea budget, except during any development phases where we have agreed or will agree to carry their interests.

With respect to Block P, the EG MMH approved our appointment as technical operator in August 2020 and, since we were appointed, we rely on the timely payment of cash calls by our joint venture owners to pay for 46.3% of the Equatorial Guinea budget, except during any development phases where we have agreed or will agree to carry their interests.

The continued economic health of our joint venture owners could be adversely affected by low crude oil prices, thereby adversely affecting their ability to make timely payment of cash calls.

If low crude oil, natural gas and NGLs prices, operating difficulties or declines in reserves result in our revenues being less than expected or limit our ability to enter into debt financing arrangements, or our joint venture owners fail to pay their share of project costs, we may be unable to obtain or expend the capital necessary to undertake or complete future drilling programs or to acquire additional reserves.

We do not currently have any commitments for future external funding for capital expenditures or acquisitions beyond cash generated from operating activities and our $50 million Facility Agreement (the commitments under which decreased to $43.8 million beginning October 1, 2023).

We do not currently have any commitments for future external funding for capital expenditures or acquisitions beyond cash generated from operating activities and the agreement governing our 2025 RBL Facility (the “2025 Facility Agreement”) .

Our ability to secure additional or replacement financing to finance expenditure beyond our current committed capital expenditure for the next 12 months may be limited.

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Even if we succeed in selling additional equity securities to raise funds, at such time the ownership percentage of our existing stockholders would be diluted, and new investors may demand rights, preferences or privileges senior to those of existing stockholders.

If we raise additional capital through debt financing, the financing may involve covenants that restrict our business activities or our ability to make future acquisitions.

If we raise additional capital through debt financing, the financing may involve covenants that restrict our business activities or our ability to

make future acquisitions.

If cash generated by operations or cash available under any financing sources is not sufficient to meet our capital requirements beyond our current committed expenditure for the next 12 months, the failure to obtain additional financing could result in a curtailment of our operations relating to the development of our properties or prevent us from consummating acquisitions of additional reserves.

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If we are unable to increase our proved quantities, there will likely be a material impact on our cash flows, business and operations.

We may not enter into definitive agreements with the BWE Consortium to explore and exploit new properties, and we may not be in a position to control the timing of development efforts, the associated costs or the rate of production of the reserves operated by the BWE Consortium or from any non-operated properties in which we have an interest.

On October 11, 2021, we announced our entry into a consortium with the “BWE Consortium” and that the BWE Consortium had been provisionally awarded two blocks, G12-13 and H12-13, in the 12th Offshore Licensing Round in Gabon.

Negotiations to finalize the commercial terms were held in 2023, however they were halted late in the year due to the presidential elections.

The negotiations were kick started again at the request of the Gabonese Government in early February 2024, where the consortium and the government came to an agreement on the fiscal terms on February 9, 2024.

The next step is concluding the terms of the production sharing contracts with the Gabonese government.

BW Energy will be the operator with a 37.5% working interest and we and Panoro Energy will have a 37.5% working interest and 25% working interest, respectively, as non-operating joint owners.

The joint owners in the BWE Consortium intend to reprocess existing seismic and carry out a 3-D seismic campaign on these two blocks and have also committed to drilling exploration wells on both blocks.

Our obligations within the BWE Consortium are subject to a number of conditions, including the negotiation and execution of production sharing contracts with the Gabonese government, as well the entry into joint operating agreements with our joint interest owners.

There is no assurance that we will be able to agree to terms on definitive production sharing contracts with the Gabonese government nor joint operating agreements with the joint owners in the BWE Consortium.

If we are unable to negotiate and enter into definitive agreements with each party, we may not be able to explore, develop and exploit new properties, and our results of operations could be materially adversely affected.

We may have limited control over matters relating to development and exploitation activities, including the timing of and capital expenditures for such activities, in projects where we are not the operator, including properties operated by the BWE Consortium.

The Company does not always control decisions made under joint operating agreements, and the parties under such agreements may fail to meet their obligations.

The Company conducts many of its exploration and production operations through joint operating agreements with other parties under which the Company may not control decisions, either because it does not have a controlling interest or is not an operator under the agreement.

Such decisions may relate to development and exploitation activities, including the timing of the capital expenditures for such activities.

The success and timing of development and exploitation activities on such properties, depends upon a number of factors, including:

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• approval of other participants in drilling wells;

risk of other a non-operator’s failure to pay its share of costs, which may require us to pay our proportionate share of the defaulting party’s share of costs;

• risk of a non-operator’s failure to pay its share of costs, which may require us to pay our proportionate share of the defaulting party’s share of costs;

• selection of technology;

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• the operator’s desire to drill more wells or build more facilities on a project inconsistent with our capital budget, whether on a cash basis or through financing, which may limit our participation in those projects or limit the percentage of our revenues from those projects.

There is also a risk that these parties may at any time have economic, business, or legal interests or goals that are

inconsistent with the Company’s, and therefore, decisions may be made that the Company does not believe are in its best interest.

Moreover, parties to these agreements may be unable to meet their economic or other obligations, and the Company may be required to fulfill those obligations alone.

In either case, the value of the investment may be adversely affected.

The occurrence of any of the foregoing events could have a material adverse effect on our anticipated exploration and development activities.

We have limited control over the assets we do not operate.

We have limited control over matters relating to development and exploitation activities, including the timing of and capital expenditures for such activities and compliance with environmental, safety, and other standards, of assets where we are not the operator.

The operator and our fellow non-operating owners of these properties may act in ways that are not in our best interest.

Additionally, we are dependent on the operator and our fellow non-operating owners of such projects to fund their contractual share of the capital expenditures of such projects.

Our dependence on the operator and such parties could have a material adverse effect on our business, results of operations or financial condition.

Our offshore operations involve special risks that could adversely affect our results of operations.

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Even a detailed review of records and properties may not necessarily reveal existing or potential problems, nor will it permit a buyer to become sufficiently familiar with the properties to assess fully their deficiencies and potential.

Inspections may not always be performed on every well, and potential problems, such as ground water contamination and other environmental conditions and deficiencies in the mechanical integrity of equipment are not necessarily observable even when an inspection is undertaken.

Inspections may not always be performed on every well, and potential problems, such as ground

water contamination and other environmental conditions and deficiencies in the mechanical integrity of equipment are not necessarily observable even when an inspection is undertaken.

Any unidentified problems could result in material liabilities and costs that negatively impact our financial condition.

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In addition, we may be required to recognize losses in accordance with exit or disposal activities.

The proposed acquisition of Svenska may not be consummated and if consummated, we may not realize the anticipated benefits expected from the acquisition.

On February 29, 2024, Buyer and Seller, entered into the Share Purchase Agreement pursuant to which the Buyer will purchase all of the issued shares in the capital of Svenska for $66.5 million in cash, subject to adjustment as described in the Share Purchase Agreement.

Pursuant to the terms and subject to the conditions of the Share Purchase Agreement, upon Closing, Buyer will acquire Svenska and, as a result, Svenska’s primary asset:

a 27.39% non-operated working interest in the deepwater producing Baobab field in Block CI-40, offshore Cote d’Ivoire in West Africa.

Buyer will also acquire a 21.05% non-operated working interest in OML 145, a non-producing discovery located offshore of Nigeria that is not expected to be developed at this time.

The Purchase Price will be funded by a combination of a dividend of cash on Svenska’s balance sheet to the Seller immediately prior to the consummation of the Acquisition and a portion of VAALCO’s cash-on-hand.

VAALCO estimates that cash due from VAALCO at Closing will be in the range of approximately $30 to $40 million.

Closing is subject to obtaining necessarily regulatory approvals in Cote d’Ivoire and Sweden and the satisfaction of other customary closing conditions.

If the closing conditions are not satisfied or waived within nine months of date of the Share Purchase Agreement, then either the Buyer or the Seller may, at its discretion, terminate the Share Purchase Agreement.

No assurance can be given that the required approvals will be obtained or that the required conditions to closing will be satisfied or waived in a timely manner or at all, and accordingly consummation of the Acquisition may be delayed or not occur at all.

If consummated, the success of the Acquisition will depend, in part, on our ability to realize the anticipated benefits from combining our business with Svenska’s business.

The anticipated benefits and efficiencies of the Acquisition may not be realized fully or at all, may take longer to realize than expected, may not be realized or could have other adverse effects that we do not currently foresee.

The failure to realize the anticipated benefits and synergies expected from the Acquisition could adversely affect our business, financial condition and operating results.

Our reserve information represents estimates that may turn out to be incorrect if the assumptions on which these estimates are based are inaccurate.

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Reserve engineering is a subjective process of estimating the underground accumulations of crude oil, natural gas and NGLs that cannot be measured in an exact manner.

The estimates included in this document are based on various assumptions required by the SEC, including non-escalated prices and costs and capital expenditures subsequent to December 31, 2023, and, therefore, are inherently imprecise indications of future net revenues.

The estimates included in

this document are based on various assumptions required by the SEC, including non-escalated prices and costs and capital expenditures subsequent to December 31, 2024, and, therefore, are inherently imprecise indications of future net revenues.

Estimates of economically recoverable crude oil, natural gas and NGLs reserves and the future net cash flows from them are based upon a number of variable factors and assumptions, such as historical production from the properties, production rates, ultimate reserves recovery, timing and amount of capital expenditures, marketability of crude oil, natural gas and NGLs, royalty rates, the assumed effects of regulation by governmental agencies, and future operating costs, all of which may vary materially from actual results.

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Our proved reserves are in foreign countries and are or will be subject to service contracts, production sharing contracts and other arrangements.

The quantity of crude oil, and natural gas and NGLs that we will ultimately receive under these arrangements will differ based on numerous factors, including the price of crude oil, and natural gas and NGLs, production rates, production costs, cost recovery provisions and local tax and royalty regimes.

The quantity of crude oil, natural gas and NGLs that we will ultimately receive under these arrangements will differ based on numerous factors, including the price of crude oil, natural gas and NGLs, production rates, production costs, cost recovery provisions and local tax and royalty regimes.

Changes in many of these factors could affect the estimates of proved reserves in foreign jurisdictions.

If our assumptions underlying accruals for abandonment/ decommissioning costs are too low, we could be required to expend greater amounts than expected.

All of our existing properties in Gabon which have future abandonment obligations are located offshore.

Our existing properties in Egypt and Canada are onshore.

The costs to abandon offshore on onshore wells and the related infrastructure may be substantial.

For financial accounting purposes, we record the fair value of a liability for an asset retirement obligation in the period that it is incurred and capitalize the related costs as part of the carrying amount of the long-lived assets.

The estimated liability is reflected in the “Asset retirement obligations” and the “Accrued liabilities and other” line items of our consolidated balance sheet.

As part of the Etame Marin block production license, we are subject to an agreed-upon cash funding arrangement for the eventual abandonment of all offshore wells, platforms and facilities on the Etame Marin block.

Based upon the most recent abandonment study completed in November 2021, the abandonment cost estimate used for this purpose is approximately $81.3 million ($47.8 million net to our 58.8% working interest) on an undiscounted basis.

On an annual basis over the remaining life of the production license, we must fund a portion of these estimated abandonment costs.

Future changes to the anticipated abandonment cost estimates could change our asset retirement obligations and increase the amount of future abandonment funding payments we are obligated to make.

In Egypt, under model concession agreements and the Egyptian Fuel Materials Law No.

66/1953 as amended and its Executive Regulations issued by Minister of Industry Decree No.

758/1972 as amended (the “Fuel Materials Law”), liabilities in respect of decommissioning movable and immovable assets (other than wells) passes to the Egyptian Government through the transfer of ownership from the contractor to the government under the cost recovery process.

The model concession agreements do not deal with area handover and abandonment upon termination, expiration or withdrawal from a concession agreement and certain articles in the Fuel Materials Law may apply, albeit the matter in practice is within the discretion of the EGPC.

While the current risk that we may become liable for decommissioning liabilities in Egypt is low, future changes to legislation or practice of the EGPC could result in decommissioning, abandonment and/or handover liabilities in Egypt.

Any increase in Egyptian decommissioning liabilities could adversely affect our financial condition.

In relation to petroleum wells, the contractor is responsible for decommissioning non-producing wells under a decommissioning plan approved by EGPC.

If EGPC agrees that a producing well is not economic, then the contractor will be responsible for decommissioning the well under an EGPC-approved decommissioning plan.

EGPC, at its own discretion, may not require a well to be decommissioned if it wants to preserve the ability to use the well for other purposes.

As EGPC has discretion on decommissioning wells, there is a risk that we could incur well decommissioning costs.

In accordance with the respective concession agreements, expenses approved by EGPC are recoverable through the cost recovery mechanism.

In Canada, liabilities in respect of the decommissioning of our wells, fields and related infrastructure are derived from legislative and regulatory requirements concerning the decommissioning of wells and production facilities and require us to make provisions for and/or underwrite the liabilities relating to such decommissioning.

It is difficult to accurately forecast the costs that we would incur in satisfying any decommissioning obligations.

When such decommissioning liabilities crystallize, we will be liable either on our own or jointly and severally liable with any other former or current partners in the field.

In the event that we are jointly and severally liable with other partners and such partners default on their obligations, we would remain liable, and our decommissioning liabilities could be magnified significantly through such default.

Any significant increase in the actual or estimated decommissioning costs that we incur may adversely affect our financial condition.

Under the Alberta LMF, the AER began to set annual mandatory closure spend targets for all licensees with inactive inventory in 2022.

Under the AER’s Closure Nomination Program, introduced in February 2023 through an update to AER Directive 088:

Licensee Life-Cycle Management, eligible landowners or land rights holders can nominate oil and gas wells and facilities that have been inactive or abandoned for longer than five years, for closure, at the expense of the licensee.

Liability management in the Alberta oil and gas sector will continue to evolve as the AER continues its phased implementation of the new LMF.

If we are required to expend greater amounts than expected on abandoning or decommissioning costs, this could materially affect our revenues and financial performance.

We may not generate sufficient cash to satisfy our payment obligations under the Merged Concession Agreement or be able to collect some or all of our receivables from the EGPC, which could negatively affect our operating results and financial condition.

On January 19, 2022, subsidiaries of TransGlobe executed the Merged Concession Agreement with the EGPC, which is effective upon the Merged Concession Effective Date.

Under the Merged Concession Agreement, VAALCO is obligated to make modernization payments that total $65 million and are payable over six years from the Merged Concession Effective Date of which $45.0 million have been paid.

Under the Merged Concession Agreement, TransGlobe will be required to pay an additional $10 million on February 1st for each of the next two years.

If our assumptions underlying accruals for abandonment and decommissioning costs are too low, we could be required to expend greater amounts than expected.

Our estimates of the future abandonment and remediation costs are subject to change and could vary substantially from our actual costs.

Under various contracts, permits and regulations, we have material legal obligations to remove tangible equipment and restore the land or seabed at the end of operations at operational sites.

Our largest asset removal obligations involve plugging and abandonment of wells, removal and disposal of offshore oil and gas platforms around the world, as well as oil and gas production facilities.

Estimating future asset removal costs requires significant judgment.

Most of these removal obligations are many years, or decades, in the future and the contracts and regulations often have vague descriptions of what removal practices and criteria must be met when the removal event actually occurs.

The carrying value of our asset retirement obligation estimate is sensitive to inputs such as asset removal technologies and costs, regulatory and other compliance considerations, expenditure timing, and other inputs into valuation of the obligation, including discount and inflation rates, which are all subject to change between the time of initial recognition of the liability and future settlement of our obligation.

If we are required to expend greater amounts than expected on abandoning or decommissioning costs or on future abandonment funding, this could materially affect our revenues and financial performance.

We may not generate sufficient cash to satisfy our payment obligations under the Merged Concession Agreement or be able to collect some or all of our receivables from EGPC, which could negatively affect our operating results and financial condition.

Under the Merged Concession Agreement, the Company is obligated to make modernization payments that total $65 million and are payable over six years from the Merged Concession Effective Date, of which $45.0 million plus a $1.0 million signing bonus have been paid as of December 31, 2024.

Under the Merged Concession Agreement, the Company will be required to pay an additional $10 million on February 1st for each of the next two years.

In accordance with the Merged Concession Agreement, we agreed to substitute the 2023 and 2024 payments and issue two $10.0 million credits against receivables owed from EGPC.

In addition, VAALCO has also committed to spending a minimum of $50 million over each five-year period for the 15 years of the primary term (total $150 million).

In addition, the Company has also committed to spending a minimum of $50 million over each five-year period for the 15 years of the primary term (total $150 million).

Our ability to make scheduled payments arising from the Merged Concession Agreement will depend on our financial condition and operating performance, which would be subject to then prevailing economic, industry and competitive conditions and to certain financial, business, legislative, regulatory and other factors beyond our control.

We may be unable to maintain a level of cash flow sufficient to permit us to satisfy the payment obligations under the Merged Concession Agreement.

If we are unable to satisfy our obligations, it is possible that the EGPC could seek to terminate the Merged Concession Agreement, which would negatively affect our operating results and financial condition.

In addition, as of the Merged Concession Effective Date, there was an adjustment of funds owed to us for the difference between historic and Merged Concession Agreement commercial terms applied against Eastern Desert production from the Merged Concession Effective Date.

The cumulative amount of the effective date adjustment was estimated at $67.5 million.

However, the cumulative amount of the effective date adjustment is currently being finalized with EGPC and could result in a range of outcomes based on the final price per barrel negotiated.

At December 31, 2023, the remaining $50.3 million is recorded on our consolidated balance sheet in Receivables-Other, net.

If the EGPC’s financial position becomes impaired or it disputes or if the EGPC refuses to pay some or all of the said amount, our ability to fully collect such receivable from the EGPC could be impaired, which could negatively affect our operating results and financial condition.

The Egyptian PSCs contain assignment provisions which, if triggered, could adversely affect our business.

On October 13, 2022, VAALCO completed its business combination transaction with TransGlobe whereby TransGlobe became an indirect wholly-owned subsidiary of VAALCO.

Legacy subsidiaries of TransGlobe are party to the Egyptian PSCs, which contain restrictive wording relating to assignments of rights under such agreements which, if triggered, require consent of the Egyptian Government in connection with any such assignment (the “Assignment Provisions”).

If triggered, the Assignment Provisions also provide that (i) in certain circumstances, the EGPC has the right to acquire the interest intended to be assigned;

and (ii) an assignment fee is payable to the EGPC in an amount equal to 10% of the value of each assignment.

We do not believe the Arrangement triggered the Assignment Provisions.

EGPC has not concurred that no assignment fee is payable.

We are continuing to engage in discussions with the office of the Minister of Petroleum and Mineral Resources and the EGPC for the purpose of resolving the matter.

Resolution of this matter could result in a range of outcomes and no assurance can be given that such outcomes will not involve an offset of amounts owed by EGPC to VAALCO.

If the Arrangement is deemed to have triggered the Assignment Provisions or VAALCO agrees to make payment to EGPC as part of a resolution, such payment could have an adverse effect on the value of our assets and could adversely affect our results of operations or financial condition.

If we are unable to satisfy our obligations, it is possible that EGPC could seek to terminate the Merged Concession Agreement, which would negatively affect our operating results and financial condition.

In addition, as of the Merged Concession Effective Date, an effective date adjustment was owed to the Company for the difference in the historic commercial terms and the revised commercial terms applied against the production since the Merged Concession Effective Date (as defined herein) (the “Effective Date Adjustment”).

The Company recognized a receivable in connection with the Effective Date Adjustment of $67.5 million as of October 2022, based on historical realized prices (the “Backdated Receivable”).

In 2023 and 2024, the Company received payments or provided offsets against the Backdated Receivable.

As of December 31, 2024, the remaining net receivable of $33.2 million is recorded in the “Egypt receivables and other” line item on our Consolidated Balance Sheet.

If EGPC’s financial position becomes impaired or if EGPC disputes or refuses to pay some or all of the said amount, our ability to fully collect such receivable from EGPC could be impaired, which could negatively affect our operating results and financial condition.

We could lose our interest in Block P in Equatorial Guinea if we do not meet our commitments under the production sharing contract.

Our Block P production sharing contract provides for a development and production period of 25 years from the date of approval of a development and production plan.

Our Block P production sharing contract provides for a development and production period of 25 years from the first oil production.

We and our Block P joint venture owners are evaluating the timing and budgeting for development and exploration activities in the block.

We have completed a feasibility study of a standalone production development opportunity of the Venus discovery on Block P and on July 15, 2022 submitted to the EG MMH a plan of development for Block P which on September 16, 2022 was approved by the government of Equatorial Guinea.

Due to delays by the partners in agreeing on certain terms relating to joint operations, the EG MMH delayed commencement of the Plan of Development, but on August 24, 2023, the EG MMH directed that activities relating to the Plan of Development resume.

There can be no certainty any such transaction will be completed or that we will be able to commence drilling operations in Block P.

There can be no certainty that any such transaction will be completed or that we will be able to commence drilling operations in Block P.

If the joint venture owners of Block P fail to meet the commitments under the production sharing contract amendment, our capitalized costs of $10 million associated with Block P interest would be impaired.

There are no assurances that we will be able to extend the Block CI-40 PSC.

The Block CI-40 PSC expires in April 2028.

The Block CI-40 PSC can be extended by 10 years so long as certain conditions are met.

Negotiations to extend the Block CI-40 PSC began in January 2024, led by the operator, CNR International (Côte d'Ivoire) S.A.R.L (the “Operator”), with the Director General of Hydrocarbons and the Government of the Côte d’Ivoire.

Any extension is subject to approval of the Council of Ministers and formal approval by presidential decree.

There can be no assurance that an extension will be approved or that any extension’s terms will not contain terms less favorable than our present arrangement.

If the Block CI-40 PSC expires, our results of operations would be adversely affected.

The FPSO in Côte d'Ivoire ceased hydrocarbon production on January 31, 2025 for scheduled maintenance.

Our results will be adversely affected until the FPSO is returned to service which may be a time later than we expect.

As an offshore asset, we, along with the operator and contractors of the Block CI-40 PSC, depend on the FPSO to store the crude oil produced prior to sale to customers.

The FPSO contract expires in December 2025.

The FPSO will be in transit to dry dock in early 2025 for planned maintenance and upgrades.

It ceased hydrocarbon production as scheduled on January 31, 2025 and the final lifting of crude oil from the FPSO concluded on February 6, 2025.

The project team mobilization efforts are on schedule and have significantly progressed, deploying the necessary workforce support vessels and equipment to facilitate the safe disconnection of the FPSO.

The vessel is planned to be wet towed to the shipyards in Dubai for refurbishment upon departure from the field around March 2025.

During this time, production relating to the Block CI-40 PSC will be halted and we will receive no revenues from the Block CI-40 PSC.

Additionally, there can be no

assurance that the FPSO will return to service in the expected timeframe or that the costs of returning it to service will not be more than expected, and in either such case our results would be adversely affected.

Commodity derivative transactions that we enter into may fail to protect us from declines in commodity prices and could result in financial losses or reduce our income.

In order to reduce the impact of commodity price uncertainty and increase cash flow predictability relating to the marketing of our crude oil, natural gas and NGLs we have entered into and may continue to enter into derivative arrangements with respect to a portion of our expected production.

Our derivative contracts typically consist of a series of commodity swap contracts, such as puts, collars and fixed price swaps, and are limited in duration.

The following table shows the hedges outstanding at December 31, 2023:

Settlement Period

Type of Contract

Average Monthly Volumes

Weighted Average Put Price

Weighted Average Call Price

January 2024 - March 2024

April 2024 - June 2024

The following table shows the additional hedges entered into in 2024:

Settlement Period

Type of Contract

Average Monthly Volumes

Weighted Average Put Price

Weighted Average Call Price

July 2024 - September 2024

The hedge counterparty will be obligated to make payments to us to the extent that the floating (market) price is below an agreed fixed (strike) price.

However, hedging agreements expose us to risk of financial loss if the counterparty to a hedging contract defaults on our contract obligations.

Disruptions in the market could also lead to sudden changes in the liquidity of the counterparties to our hedge transactions which in turn limit our ability to perform under their hedging contracts with us.

Even if we accurately predict sudden changes, our ability to negate the risk may be limited depending upon market conditions.

However, hedging agreements expose us to risk of financial loss if the counterparty to a hedging contract defaults on its contract obligations.

Disruptions in the market could also lead to sudden changes in the liquidity of the counterparties to our hedge transactions, which in turn limits our ability to perform under their hedging contracts with us.

Even if we accurately predict sudden changes, our ability to negate the related risk may be limited depending upon market conditions.

If the creditworthiness of our counterparties deteriorates and results in their non-performance, we could incur a significant loss.

Derivative arrangements also expose us to the risk of financial loss in some circumstances, including when production is less than the volume covered by the derivative instruments or when there is an increase in the differential between the underlying price and actual prices received in the derivative instrument.

In addition, certain types of derivative arrangements may limit the benefit that we could receive from increases in the prices for crude oil.

natural gas and NGLs, and may expose us to cash margin requirements.

In addition, certain types of derivative arrangements may limit the benefit that we could receive from increases in the prices for crude oil, natural gas and NGLs, and may expose us to cash margin requirements.

We are exposed to the credit risks of the third parties with whom we contract.

We may be exposed to third-party credit risk through our contractual arrangements with government entities party to our PSCs, our current or future joint venture owners, marketers of our petroleum and natural gas production, purchasers of our oil, natural gas and NGLs products and other parties.

In addition, we may be exposed to third-party credit risk from operators of properties in which we have a Working Interest or Royalty Interest.

We are exposed to third-party credit risk through our contractual arrangements with government entities party to our PSCs, our current or future joint venture owners, marketers of our petroleum and natural gas production, purchasers of our oil, natural gas and NGLs products and other parties.

In addition, we are exposed to third-party credit risk from operators of properties in which we have a Working Interest or Royalty Interest.

In the event such entities fail to meet their contractual obligations to us, such failures may have a material adverse effect on our business, financial condition, results of operations and prospects.

In addition, poor credit conditions in the industry generally and among our joint venture owners may affect a joint venture owner’s willingness to participate in our ongoing capital program, potentially delaying the program and the results of such program until it finds a suitable alternative partner.

To the extent that any of such third parties go bankrupt, become insolvent, or make a proposal or institute any proceedings relating to bankruptcy or insolvency, it could result in our inability to collect all or a portion of any money owing from such parties.

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In addition, if our significant customers cease to purchase or reduce the volume they purchase of our crude oil, natural gas or NGLs, the loss or reduction could have a detrimental effect on our production volumes and may cause a temporary interruption in sales of, or a lower price for, our crude oil, natural gas and NGLs.

In addition, we are and may in the future be exposed to third-party credit risk through our contractual arrangements with governmental entities in Gabon or the EGPC.

Significant changes in the crude oil industry, including fluctuations in commodity prices and economic conditions, environmental regulations, government policy, royalty rates and other geopolitical factors, could adversely affect our ability to realize the full value of our accounts receivable from government entities in Gabon or the EGPC.

Historically, we have had significant account receivables outstanding from governmental entities in Gabon and the EGPC.

While the EGPC has made regular payments of these amounts owing, the timing of these payments has historically been longer than the normal industry standard.

In addition, we are and may in the future be exposed to third-party credit risk through our contractual arrangements with governmental entities in countries where we operate.

Historically, we have had significant account receivables outstanding from governmental entities in countries where we operate.

For example, while EGPC has made regular payments of these amounts owing, the timing of these payments has historically been longer than the normal industry standard.

In addition, EGPC has at times faced difficulties in accessing foreign exchange markets for the purpose of obtaining U.S.

dollars in exchange for Egyptian pounds.

In the event the Governments of Gabon or Egypt fails to meet their respective obligations or we are forced to accept payment in foreign currencies, such failures could materially adversely affect our financial and operational results.

In the event the governments of the countries where we operate fail to meet their respective obligations or we are forced to accept payment in foreign currencies, such failures could materially adversely affect our financial and operational results.

We are also exposed to third-party credit risk through our banking relationships in the jurisdictions in which we operate.

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If any of these security breaches were to occur, they could lead to losses of sensitive information, critical infrastructure or capabilities essential to our operations and could have a material adverse effect on our reputation, financial position, results of operations and cash flows.

Cybersecurity attacks in particular are becoming more sophisticated, and geopolitical tensions or conflicts, such as Russia’s invasion of Ukraine, may further heighten the risk of such attacks.

Cybersecurity attacks in particular are becoming more sophisticated, and geopolitical tensions or conflicts, such as Russia’s invasion of Ukraine or the ongoing conflicts in the Middle East, may further heighten the risk of such attacks.

We rely extensively on information technology systems, including internet sites, computer software, data hosting facilities and other hardware and platforms, some of which are hosted by third parties, to assist in conducting our business.

Our technologies systems and networks, and those of our business associates may become the target of cybersecurity attacks, including without limitation malicious software, attempts to gain unauthorized access to data and systems, and other electronic security breaches that could lead to disruptions in critical systems and materially and adversely affect us in a variety of ways, including the following:

• unauthorized access to and release of seismic data, reserves information, strategic information or other sensitive or proprietary information, which could have a material adverse effect on our ability to compete for crude oil, natural gas and NGLs resources;

• data corruption, communication interruption, or other operational disruption during drilling activities could result in failure to reach the intended target or a drilling incident;

unauthorized access to and release of personal identifying information of employees and vendors, which could expose us to allegations that we did not sufficiently protect that information;

a cybersecurity attack on a vendor or service provider, which could result in supply chain disruptions and could delay or halt operations;

• unauthorized access to and release of personal identifying information of employees and vendors, which could expose us to allegations that we did not sufficiently protect that information and potential liabilities under domestic and international data and privacy laws;

• a cybersecurity attack on a vendor or service provider, which could result in supply chain disruptions that could delay or halt operations;

• a cybersecurity attack on third-party gathering, transportation, processing, fractionation, refining or export facilities, which could delay or prevent us from transporting and marketing our production, resulting in a loss of revenues;

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We face risks related to geopolitical events, international hostility, epidemics, outbreaks and other macroeconomic events that are outside of our control.

The occurrence of certain geopolitical events, including those arising from terrorist activity, international hostility, public health crisis, and the economic impact of global trade tension and the imposition of tariffs, could significantly disrupt our business and operational plans and adversely affect our results of operations, cash flows, financial condition and liquidity.

The occurrence of certain geopolitical events, including those arising from terrorist activity, international hostility, public health crises, and the economic impact of global trade tensions and the imposition of tariffs, could significantly disrupt our business and operational plans and adversely affect our results of operations, cash flows, financial condition and liquidity.

For instance, the ongoing conflicts in the Middle East and between Russia and Ukraine have and may continue to cause geopolitical instability, and adversely impact the global economy, supply chains and specific markets and industries.

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• logistical challenges, including those resulting from border closures and travel restrictions, as well as the possibility that our ability to continue production may be interrupted, limited or curtailed if workers and/or materials are unable to reach our offshore platforms and FSO charter vessel or our counterparties are unable to lift crude oil from our FSO charter vessel;

• economic, political and regulatory conditions domestically and internationally, including imposition of tariffs or other tax incentives or disincentives;

• we may be materially adversely affected by the effects of sanctions and other penalties imposed on Russia by the U.S., the European Union and other countries;

• we may experience a structural shift in the global economy and our demand for crude oil, natural gas and NGLs as a result of changes in the way people work, travel and interact, or in connection with a global recession or depression.

In early 2025, the new U.S.

presidential administration announced wide-ranging policy changes and issued numerous executive actions on topics including international trade, energy resources, corporate taxes, global climate change initiatives, employment practices, corporate compliance programs, environmental regulations, as well as other matters.

Further, the new presidential administration has indicated an intent to make structural changes to the executive branch of the federal government, including significant reductions in the federal workforce.

Continuing legal challenges to many of the policy changes and executive actions are expected.

Such actions may directly or indirectly impact our industry and could lead to increased regulatory uncertainty and volatility.

We cannot predict how these policy changes and executive actions will be implemented and interpreted, or the ultimate effect they will have on our business, financial condition and results of operations.

We cannot reasonably estimate the period of time that these conditions will persist;

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Production cuts mandated by the government of Gabon, a member of OPEC, could adversely affect our revenues, cash flow and results of operations.

After terminating its membership with OPEC in 1995, Gabon re-joined OPEC as a full member in July 2016.

Historically and from time to time, members of OPEC have entered into agreements to reduce worldwide production of crude oil, including the agreement reached in April 2020 among OPEC member countries and other leading allied producing countries (collectively, “OPEC+”) to reduce the gap between excess supply and demand in an effort to stabilize the international oil market.

Gabon undertook measures to comply with such OPEC+ production quota agreement.

As a result, the Minister of Hydrocarbons in Gabon requested that we reduce our production beginning July 2020 and continuing through April 20, 2021 in compliance with the OPEC+ mandate, and we took measures to temporarily reduce our production.

In July 2021, OPEC+ agreed to increase production beginning in August 2021 and to gradually phase out prior production cuts by September 2022.

The decision to increase production was reaffirmed by an OPEC+ meeting held on February 2, 2022.

However, as a result of the recent decline in oil prices, on October 5, 2022, OPEC+ announced plans to reduce overall oil production by 2 MMBbls per day starting November 2022.

We have not received any mandate to reduce current oil production from the Etame Marin block as a result of the OPEC+ initiative and currently, our production is not impacted by OPEC+ curtailments.

Historically and from time to time, members of OPEC and other leading allied producing countries (collectively, “OPEC+”) have entered into agreements to reduce worldwide production of crude oil to reduce the gap between excess supply and demand in an effort to stabilize the international oil market.

As a member of OPEC+, Gabon may take measures to comply with such OPEC+ production quota agreements.

As a result, the Minister of Hydrocarbons may request us to limit our production for a period of time in compliance with the OPEC+ mandate.

The ability of the OPEC+ to agree on and to maintain crude oil price and production controls has also had, and is likely to continue to have, a significant impact on the market prices of crude oil.

We have not received any mandate to reduce current oil production from the Etame Marin block as a result of an OPEC+ initiative and currently, our production is not impacted by OPEC+ curtailments.

However, any future reduction in our crude oil production or export activities for a substantial period could materially and adversely affect our revenues, cash flows and results of operations.

Gabon remains a member of OPEC+.

There were no required curtailments in 2023.

We have less control over our investments in foreign properties than we would have over our domestic investments.

Our exploration, development and production activities are subject to various political, economic and other uncertainties, including but not limited to changes, sometimes frequent or marked, in energy policies or the personnel administering them, expropriation of property, cancellation or modification of contract rights, changes in laws and policies governing operations of foreign-based companies, unilateral renegotiation of contracts by governmental entities, uncertainties as to whether the laws and regulations will be applicable in any particular circumstance, uncertainty as to whether we will be able to demonstrate to the satisfaction of the applicable governing authorities compliance with governmental or contractual requirements, redefinition of international boundaries or boundary disputes, foreign exchange restrictions, currency fluctuations, foreign currency availability, royalty and tax increases, changes to tax legislation or the imposition of new taxes, the imposition of production bonuses or other charges and other risks arising out of governmental sovereignty over the areas in which our operations are conducted.

Our exploration, development and production activities are subject to various political, economic and other uncertainties, including but not limited to changes, sometimes frequent or marked, in energy policies or the personnel administering them, expropriation of property, cancellation or modification of contract rights, changes in laws and policies governing operations of foreign-based companies, unilateral renegotiation of contracts by governmental entities, uncertainties as to whether laws and regulations will be applicable in any particular circumstance, uncertainty as to whether we will be able to demonstrate to the satisfaction of the applicable governing authorities compliance with governmental or contractual requirements, redefinition of international boundaries or boundary disputes, foreign exchange restrictions, currency fluctuations, foreign currency availability, royalty and tax increases, changes to tax legislation or the imposition of new taxes, the imposition of production bonuses or other charges and other risks arising out of governmental sovereignty over the areas in which our operations are conducted.

Our operations require, and any future opportunistic acquisitions may require, protracted negotiations with host governments, local governments and communities, local competent authorities, national oil companies, and third parties.

Host governments may also conduct audits of our operations, the results of which may have a significant negative impact on our reported earnings or cash flows.

Host governments may seek to participate in oil, natural gas or NGLs projects in a manner that could be diluted to our interests.

Host governments may seek to participate in oil, natural gas or NGLs projects in a manner that could be dilutive to our interests.

Host governments may also require us to hire a specified percentage of local citizens in our operations.

In addition, if a dispute arises with respect to our foreign operations, we may be subject to the exclusive jurisdiction of foreign courts or may not be successful in subjecting foreign persons, especially foreign crude oil ministries and national oil companies, to the jurisdiction of the U.S.

In December 2021 and during 2022, the Bank of Central African States (“BEAC”), which is the central bank for the Central African Economic and Monetary Community (CEMAC), passed new regulations and instructions for the CEMAC FX regulations, which were introduced in 2018, that only apply to the extractive industry.

The intent of the new regulations is to ensure the application of the FX regulations as of January 1, 2022, without impeding the operations of the extractive industry.

Due to the lack of necessary banking infrastructure and preparedness by the banking sector and the various government agencies to apply the new regulations, it is foreseeable that we will run the risk of seeing delays in paying our vendors and domiciliation of goods and services into the CEMAC region throughout 2024 and beyond.

As part of securing the first of two five-year extensions to the Etame PSC in 2016, we agreed to a cash funding arrangement for the eventual abandonment of all offshore wells, platforms and facilities on the Etame Marin block.

On February 28, 2019, in accordance with certain foreign currency regulatory requirements, the Gabonese branch of the international commercial bank holding the abandonment funds in a U.S.

dollar-denominated account transferred the funds to the Central Bank for CEMAC and later converted, at the request of BEAC, the funds in U.S.

dollars to franc CFA, the currency of the CEMAC, of which Gabon is one of the six member states.

The Etame PSC provides that these payments must be denominated in U.S.

After continued discussions with CEMAC, they agreed to the return of the USD funds and on January 12, 2023, the abandonment funds were returned to the USD account of the Gabonese branch of the international commercial bank.

We were allowed to re-establish a USD denominated account and made whole for the original USD amount.

Pursuant to Amendment No.

5 of the Etame PSC, we are working with Directorate of Hydrocarbons in Gabon on establishing a payment schedule to resume funding of the abandonment fund in compliance with the Etame PSC.

Private ownership of crude oil reserves under crude oil leases in the U.S.

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may be materially affected by host governments.

While the laws of each of Gabon and Equatorial Guinea recognize private and public property and the right to own property is protected by law, the laws of each country reserve, at the respective government’s discretion, the right to expropriate property and terminate contracts (including the Etame PSC and the Block P PSC) for reasons of public interest, subject to reasonable compensation, determinable by the respective government in our discretion.

While the laws of each of Gabon, Cote d'Ivoire and Equatorial Guinea recognize private and public property and the right to own property is protected by law, the laws of each country reserve, at the respective government’s discretion, the right to expropriate property and terminate contracts (including the Etame PSC, the Block CI-40 PSC, and the Block P PSC) for reasons of public interest, subject to reasonable compensation, determinable by the respective government in our discretion.

The terms of the Etame PSC include provisions for, among other things, payments to the government of Gabon for a 13% Royalty Interest based on crude oil production at published prices and payments for a shared portion of Profit Oil, based on daily production rates, which such Profit Oil has been and can continue to be taken in-kind through taking crude oil barrels rather than making cash payments.

In Canada, majority of the mineral rights are usually held by a provincial government, also known as the Crown, but a small portion, called the freehold mineral rights, may be held by others such as individuals, families or businesses.

In exchange for the right to develop oil and natural gas resources, companies make royalty payments to the Crown, which are calculated by taking a percentage of revenues generated from the sale of oil and natural gas.

We have operated in Gabon since 1995 and believe we have good relations with the current Gabonese government.

However, there can be no assurance that present or future administrations or governmental regulations in Gabon will not materially adversely affect our operations or cash flows.

The respective applicable laws governing the exploration and production of hydrocarbons in Gabon and Equatorial Guinea (Law No.

002/2019 in Gabon and Law No.

The respective applicable laws governing the exploration and production of hydrocarbons in Gabon, Cote d'Ivoire and Equatorial Guinea (Law No.

002/2019 in Gabon, Law No.

96-669 in Cote d'Ivoire, and Law No.

8/2006 in Equatorial Guinea) each provide their respective government officials with significantly broad regulatory, inspective and auditing powers with respect to the performance of petroleum operations, which include the powers to negotiate, sign, amend and perform all contracts entered into between the respective governments and independent contractors.

The executive branches of each respective government also retain significant discretionary powers, giving considerable control over the executive, judiciary and legislative branches of each government, and the ability to adopt measures with a direct impact on private investments and projects, including the right to appoint ministers responsible for petroleum operations.

Further, in Equatorial Guinea, any new PSC or equivalent agreement for the exploration and exploitation of hydrocarbons is subject to presidential ratification before it can become effective.

We are also now subject to political, economic and other uncertainties in Egypt.

Equatorial Guinea, any new PSC or equivalent agreement for the exploration and exploitation of hydrocarbons is subject to presidential ratification before it can become effective.

Any of the factors detailed above or similar factors could have a material adverse effect on our business, results of operations or financial condition.

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• a capital market reassessment of risk and reduction of available capital, making it more difficult for us and our joint owners to obtain financing for potential development projects.

Some of these risks may be higher in the developing countries in which we conduct our activities, namely, Gabon, Equatorial Guinea and Egypt.

Some of these risks may be higher in the developing countries in which we conduct our activities, namely, Gabon, Cote d'Ivoire, Equatorial Guinea and Egypt.

For example, in September 2023, Gabon experienced a largely non-violent, military coup d’état and the country’s leadership changed hands.

The group leading the coup created a Committee for the Transition and Restauration of Institutions and a new president was sworn in on the basis of a transition charter adopted by the group leading the coup.

The group leading the coup created a Committee for the Transition and Restoration of Institutions and a new president was sworn in on the basis of a transition charter adopted by the group leading the coup.

The new president has indicated that a new constitution for Gabon will be adopted and that elections will be held after a transition period.

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In addition, losses caused by these disruptions may not be covered by insurance, or even if they are covered by insurance, we may not have enough insurance to cover all of these losses.

If any violent action causes us to become involved in a dispute, we may be subject to the exclusive jurisdiction of courts outside the U.S.

If any violent action causes us to

become involved in a dispute, we may be subject to the exclusive jurisdiction of courts outside the U.S.

or may not be successful in subjecting non-U.S.

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Inflation could adversely impact our ability to control costs, including operating expenses and capital costs.

Inflation rose significantly in the second half of 2021 and through 2023.

inflation rate steadily rose in 2021 and into 2022 before eventually declining throughout 2023.

During 2024, the U.S.

inflation rate remained stable when compared to the last half of 2023, yet remained slightly higher than historical averages.

However, the U.S.

inflation rate rose slightly in January 2025 and the U.S.

inflation rate could rise significantly again in the future.

In addition, global and industry-wide supply chain disruptions have resulted in shortages in labor, materials and services.

Such shortages have resulted in inflationary cost increases for labor, materials and services and could continue to cause costs to increase, as well as a scarcity of certain products and raw materials.

To the extent inflation remains elevated, we may experience further cost increases for our operations, including oilfield services and equipment as increasing prices of oil, natural gas and NGLs, increased drilling activity in our areas of operations, as well as increased labor costs.

Such shortages have resulted in inflationary cost increases for labor, materials and services and could continue to cause costs to increase, or cause a scarcity of certain products and raw materials.

To the extent inflation remains elevated, we may experience further cost increases for our operations, including oilfield services and equipment as a result of increasing prices of oil, natural gas and NGLs, increased drilling activity in our areas of operations, and increased labor costs.

An increase in the prices of oil, natural gas and NGLs may cause the costs of materials and services we use to rise.

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While crude oil sales are denominated in U.S.

dollars, portions of our costs in Gabon are denominated in the local currency.

dollars, portions of our costs in Gabon and Cote d'Ivoire are denominated in the local currency.

A weakening U.S.

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dollar will have the effect of reducing operating costs.

The Gabon local currency is tied to the Euro.

The Gabonese and Ivorian local currency is tied to the Euro.

The exchange rate between the Euro and the U.S.

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dollars to the Gabonese local currency.

We are also exposed to foreign currency exchange risk related to certain cash, accounts receivable, long-term debt, lease obligations and accounts payable and accrued liabilities denominated in Canadian dollars, and on cash balances denominated in Egyptian pounds.

We are also exposed to foreign currency exchange risk related to certain cash, accounts receivable, lease obligations and accounts payable and accrued liabilities denominated in Canadian dollars, and on cash balances denominated in Egyptian pounds.

Some collections of our accounts receivable from the Egyptian Government are received in Egyptian pounds, and while we are generally able to spend the Egyptian pounds received on accounts payable denominated in Egyptian pounds, there remains foreign currency exchange risk exposure on Egyptian pound cash balances.

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In addition, such laws require the maintenance of records relating to transactions and an adequate system of internal controls over accounting.

There can be no assurance that our internal control policies and procedures, compliance mechanisms or monitoring programs will protect us from recklessness, fraudulent behavior, dishonesty or other inappropriate acts or adequately prevent or detect possible violations under applicable anti-bribery and anti-corruption legislation.

Our failure to comply with anti-bribery and anti-corruption legislation could result in severe criminal or civil sanctions and may subject us to other liabilities, including fines, prosecution, potential debarment from public procurement and reputational damage, all of which could have a material adverse effect on our business, results of operations and financial condition.

Investigations by governmental authorities could have a material adverse effect on our business, results of operations and financial condition.

There are inherent limitations in all control systems, and misstatements due to error or fraud that could seriously harm our business may occur and not be detected.

While our management has concluded that our internal control over financial reporting is effective, we do not expect that the relevant internal controls and disclosure controls will prevent or detect all possible errors or all instances of fraud.

no assurance that our internal control policies and procedures, compliance mechanisms or monitoring programs will protect us from recklessness, fraudulent behavior, dishonesty or other inappropriate acts or adequately prevent or detect possible violations under applicable anti-bribery and anti-corruption legislation.

Our failure to comply with anti-bribery and anti-corruption legislation, or investigations by governmental authorities, could result in severe criminal or civil sanctions and may subject us to other liabilities, including fines, prosecution, potential debarment from public procurement and reputational damage, all of which could have a material adverse effect on our business, results of operations and financial condition.

We have identified material weaknesses in our internal control over financial reporting for the fiscal year ended December 31, 2024.

If we are unable to remediate these material weaknesses or if we identify additional material weaknesses in the future or otherwise fail to maintain effective internal control over financial reporting, we may not be able to accurately or timely report financial information.

As disclosed in Part II, Item 9A, “ Controls and Procedures ,” we have identified material weaknesses in our internal control over financial reporting related to general information technology controls, effectiveness of control environment, risk assessment and design and process-level controls.

A material weakness is a deficiency or a combination of deficiencies in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the registrant's financial statements will not be prevented or detected on a timely basis.

As a result of the material weaknesses, we concluded that our internal control over financial reporting and related disclosure controls and procedures were not effective as of December 31, 2024.

We cannot be certain that the measures we may take in the future will be sufficient to remediate the control deficiencies that led to our material weaknesses in our internal control over financial reporting or that they will prevent or avoid potential future material weaknesses.

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

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A failure of the controls and procedures to detect error or fraud could seriously harm our business and results of operations.

We may not have enough insurance to cover all of the risks we face.

Our business is subject to all of the operating risks normally associated with the exploration for and production, gathering, processing, and transportation of crude oil, natural gas and NGLs, including blowouts, cratering and fire, any of which could result in damage to, or destruction of, crude oil, natural gas and NGLs wells or formations, production facilities, and other property, as well as injury to persons.

For protection against financial loss resulting from these operating hazards, we maintain insurance coverage, including insurance coverage for certain physical damage, blowout/control of a well, comprehensive general liability, worker’s compensation and employer’s liability.

However, our insurance coverage may not be sufficient to cover us against 100% of potential losses arising as a result of the foregoing, and for certain risks, such as political risk, nationalization, business interruption, war, terrorism, and piracy, for which we have limited or no coverage.

In addition, we are not insured against all risks in all aspects of our business, such as hurricanes.

The occurrence of a significant event that we are not fully insured against could have a material adverse effect on our consolidated financial position, results of operations, or cash flows.

If we are unable to remediate our existing or any future material weaknesses in our internal control over financial reporting, our ability to record, process or report financial information accurately and to prepare financial statements in an accurate and timely manner could adversely be affected, which could subject us to litigation or investigations requiring management resources and payment of legal and other expenses, negatively affect investor confidence in our financial statements and adversely impact our stock price.

Our business could suffer if we lose the services of, or fail to attract, key personnel.

We are highly dependent upon the efforts of our senior management and other key employees.

The loss of the services of our Chief Executive Officer or Chief Financial Officer, as well as any loss of the services of one or more other members of our senior management, could delay or prevent the achievement of our objectives.

The loss of the services of our Chief Executive Officer, Chief Operating Officer or Chief Financial Officer, as well as any loss of the services of one or more other members of our senior management, could delay or prevent the achievement of our objectives.

We do not maintain any “key-man” insurance policies on any of our senior management, and do not intend to obtain such insurance.

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We are subject to relinquishment obligations under certain of our title documents.

We are subject to relinquishment obligations under our title documents which oblige us to relinquish certain proportions of our concession lease and license areas and thereby reduce our acreage.

Additionally, we may be unable to drill all of our prospects or satisfy our minimum work commitments prior to relinquishment and may be unable to meet our obligations under the title documents.

We are subject to relinquishment obligations under certain of our title documents that oblige us to relinquish certain proportions of our concession lease and license areas and thereby reduce our acreage.

Additionally, we may be unable to drill all of our prospects or satisfy our minimum work commitments prior to relinquishment and may be unable to meet our

obligations under the title documents.

Failure to meet such obligations could result in concessions, leases and licenses being suspended, revoked or terminated which could have a material adverse effect on our business.

We may be exposed to the risk of earthquakes in Alberta.

We may be exposed to the risk of earthquakes in Alberta, Canada.

The AER monitors seismic activity across the province of Alberta in Canada to assess the risks associated with, and instances of, earthquakes induced by hydraulic fracturing.

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In addition, measures that restrict the availability of the local currency or impose a requirement to operate in the local currency may create other practical difficulties for us.

In December 2021 and during 2022, the Bank of Central African States (“BEAC”), which is the central bank for the Central African Economic and Monetary Community (“CEMAC”), passed new regulations and instructions for the CEMAC FX regulations, which were introduced in 2018, that only apply to the extractive industry.

The intent of the new regulations is to ensure the application of the FX regulations as of January 1, 2022, without impeding the operations of the extractive industry.

On February 28, 2019, in accordance with certain foreign currency regulatory requirements, the Gabonese branch of the international commercial bank holding the abandonment funds in a U.S.

dollar-denominated account transferred the funds to the Central Bank for CEMAC and later converted, at the request of BEAC, the funds in U.S.

dollars to franc CFA, the

currency of the CEMAC, of which Gabon is one of the six member states.

The Etame PSC provides that these payments must be denominated in U.S.

We were allowed to re-establish a USD denominated account and made whole for the original USD amount.

Pursuant to Amendment No.

5 of the Etame PSC, we are working with Directorate of Hydrocarbons in Gabon on establishing a payment schedule to resume funding of the abandonment fund in compliance with the Etame PSC.

Our results of operations, financial condition and cash flows could be adversely affected by changes to interest rates.

Our Facility Agreement is for $43.8 million, none of which had been drawn as of December 31, 2023.

As of December 31, 2024, the amount available to be drawn under our Facility Agreement was $31.3 million, none of which had been drawn.

An increase in interest rates could result in a significant increase in the amount we pay to service any subsequently drawn, and any future other debt taken out by us, resulting in a reduced amount available to fund our exploration and development activities and, if applicable, the cash available for dividends.

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These factors include, but are not limited to, increases in supplies from U.S.

shale production, international political conditions, including war, uprisings, terrorism and political unrest in the Middle East and Africa, slowdowns to the global supply chain, the domestic and foreign supply of crude oil, natural gas and NGLs, actions by OPEC+ member countries and other state-controlled oil companies to agree upon and maintain crude oil price and production controls, the level of consumer demand that is impacted by economic growth rates;

shale production;

international political conditions, including war, uprisings, terrorism and political unrest in the Middle East and Africa;

slowdowns to the global supply chain;

the domestic and foreign supply of crude oil, natural gas and NGLs;

actions by OPEC+ member countries and other state-controlled oil companies to agree upon and maintain crude oil price and production controls;

the level of consumer demand that is impacted by economic growth rates;

weather conditions;

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Any substantial and extended decline in the price of oil, natural gas and NGLs would have an adverse effect on the carrying value of our reserves, borrowing capacity, revenues, profitability and cash flows from operations and may have a material adverse effect on our business, financial condition, results of operations and prospects.

Volatile oil, natural gas and NGLs prices make it difficult to estimate the value of producing properties for acquisitions and often cause disruption in the market for oil, natural gas and NGLs producing properties, as buyers and sellers have difficulty agreeing on such value.

Price volatility also makes it difficult to budget for, and project the return on, acquisitions and development and exploitation projects.

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Weather, unexpected subsurface conditions and other unforeseen operating hazards may adversely impact our crude oil, natural gas and NGLs activities.

The crude oil, natural gas and NGLs business involves a variety of operating risks, including fire;

pipe failure, casing collapse;

abnormally pressured formations;

and environmental hazards such as crude oil spills, natural gas leaks, ruptures and discharges of toxic gases, underground migration, and surface spills or mishandling of well fluids, including chemical additives, the occurrence of any of which could result in substantial losses due to injury and loss of life, severe damage to and destruction of property, natural resources and equipment, pollution and other environmental damage, clean-up responsibilities, regulatory investigation and penalties and suspension of operations.

The crude oil, natural gas and NGLs business involves a variety of operating risks, including fire, explosions, blow-outs, pipe failure, casing collapse, abnormally pressured formations;

The occurrence of any of these or other related events could result in substantial losses due to injury and loss of life, severe damage to and destruction of property, natural resources and equipment, pollution and other environmental damage, clean-up responsibilities, regulatory investigation and penalties and suspension of operations.

Climate change could have an effect on the severity of weather (including hurricanes, floods and wildfires), sea levels, the arability of farmland, and water availability and quality.

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Unfavorable ESG ratings, as well as recent activism around fossil fuels, may dissuade investors or lenders from engaging with us in favor of companies in other industries, which could negatively impact our share price or our access to capital.

Moreover, while we have and may continue to create and publish voluntary disclosures regarding ESG matters from time to time, many of the statements in those voluntary disclosures are based on hypothetical expectations and assumptions that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith.

may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith.

Such expectations and assumptions are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established single approach to identifying, measuring and reporting on many ESG matters.

Approaches to climate change and transition to a lower-carbon economy, including government regulation, company policies, and consumer behavior, are continuously evolving.

Approaches to climate change and the transition to a lower-carbon economy, including government regulation, company policies, and consumer behavior, are continuously evolving.

At this time, we cannot predict how such approaches may develop or otherwise reasonably or reliably estimate their impact on our financial condition, results of operations and ability to compete.

However, any long-term material adverse effect on the oil and gas industry may adversely affect our financial condition, results of operations and cash flows.

In Canada, opposition by Indigenous groups to our operations, development or exploration activities may negatively impact us.

Opposition by Indigenous groups to the conduct of our operations, development or exploratory activities in any of the jurisdictions in which we conduct business may negatively impact us in terms of public perception, diversion of management’s time and resources, legal and other advisory expenses, and could adversely impact our progress and ability to explore and develop properties.

In Canada, opposition by Indigenous groups to the conduct of our operations, development or exploratory activities in any of the jurisdictions in which we conduct business may negatively impact us in terms of public perception, diversion of management’s time and resources, legal and other advisory expenses, and could adversely impact our progress and ability to explore and develop properties.

Some Indigenous groups have established or asserted Indigenous treaty and title rights to portions of Canada.

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The scope of the duty to consult by federal and provincial governments varies with the circumstances and is often the subject of litigation.

The fulfilment of the duty to consult Indigenous people and any associated duties of accommodation may adversely affect our ability, or increase the time required to obtain or renew, permits, leases, licenses and other approvals, or to meet the terms and conditions of those approvals.

The fulfillment of the duty to consult Indigenous people and any associated duties of accommodation may adversely affect our ability, or increase the time required to obtain or renew, permits, leases, licenses and other approvals, or to meet the terms and conditions of those approvals.

Continued development of common law precedent regarding existing laws relating to Indigenous consultation and accommodation as well as the adoption of new laws are expected to continue to add uncertainty to the ability of entities operating in the Canadian oil and gas industry to execute on major resource development and infrastructure projects, including, among other projects, pipelines that could adversely impact our progress and ability to explore and develop properties in Canada.

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The UNDRIP Act requires the Government of Canada to take all measures necessary to ensure the laws of Canada are consistent with the principles of UNDRIP and to implement an action plan to address UNDRIP’s objectives.

Adding further uncertainty, on June 29, 2021, the British Columbia Supreme Court issued a judgement in Yahey v British Columbia (the “Blueberry Decision”), in which it determined that the cumulative impacts of industrial development on the traditional territory of the Blueberry River First Nation (“BRFN”) in northeast British Columbia had breached BRFN’s treaty rights.

Adding further uncertainty, on June 29, 2021, the British Columbia Supreme Court issued a judgment in Yahey v British Columbia (the “Blueberry Decision”), in which it determined that the cumulative impacts of industrial development on the traditional territory of the Blueberry River First Nation (“BRFN”) in northeast British Columbia had breached BRFN’s treaty rights.

The Blueberry Decision may lead to similar claims of cumulative effects across Canada in other areas covered by treaties.

In February 2025, the European Commission adopted a package of proposals to simplify EU rules and boost competitiveness.

Among other things, the package proposes to apply the Corporate Sustainability Reporting Directive only to the largest companies (those with more than 1000 employees), focusing the sustainability reporting obligations on the companies which are more likely to have the biggest impacts on people and the environment.

Moreover, it seeks to ensure that reporting requirements on large companies do not burden smaller companies in their value chains.

We face various risks associated with increased opposition to and activism against crude oil, natural gas and NGLs exploration and development activities.

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In addition, these programs may reduce demand for our product either by incentivizing or mandating the use of other alternative energy sources, by prohibiting the use of our product, by requiring equipment using our product to shift to alternative energy sources, or by directly increasing the cost of fossil fuels to consumers.

Compliance with environmental and other government regulations could be costly and could negatively impact production.

The laws and regulations of the U.S., Canada, Egypt, Equatorial Guinea and Gabon control our current business.

Additionally, in March 2024, the SEC adopted final rules intended to enhance and standardize climate-related disclosures by public companies and in public offerings;

these rules are stayed pending the outcome of consolidated legal challenges in the Eighth Circuit Court of Appeals.

Compliance with applicable environmental laws and other government regulations could be costly and could negatively impact production.

The laws and regulations of countries where we have activities control our current business.

These laws and regulations may require that we obtain permits for our development activities, limit or prohibit drilling activities in certain protected or sensitive areas or restrict the substances that can be released in connection with our operations.

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We could also be affected by more stringent laws and regulations adopted in the future, including any related to climate change and GHG and the use of hydraulic fracturing fluids, resulting in increased operating costs.

These laws and governmental regulations, which cover matters including drilling operations, taxation and environmental protection, may be changed from time to time in response to economic or political conditions and could have a significant impact on our operating costs, as well as the crude oil, natural gas and NGLs industry in general.

While we believe that we are currently in compliance with environmental laws and regulations applicable to our operations, no assurances can be given that we will be able to continue to comply with such environmental laws and regulations without incurring substantial costs.

We are also subject to a wide variety of laws relating to health and safety, taxes, employment, labor standards, money laundering, terrorist financing, and other matters in the jurisdictions in which we operate.

These laws and other governmental regulations, which cover matters including drilling operations, taxation and environmental protection, may be changed from time to time in response to economic or political conditions and could have a significant impact on our operating costs, as well as the crude oil, natural gas and NGLs industry in general.

compliance mechanisms and monitoring programs that we have adopted and implemented may not adequately prevent or detect possible violations of such applicable laws.

Our failure to comply with any such legislation could result in severe criminal or civil sanctions and may subject us to other liabilities, including fines, prosecution and reputational damage, all of which could have a material adverse effect on our business, consolidated results of operations and consolidated financial condition.

While we believe that we are currently in compliance with environmental laws and other government regulations applicable to our operations, no assurances can be given that we will be able to continue to comply with such environmental laws and regulations without incurring substantial costs.

We have been, and in the future may become, involved in legal proceedings with governmental bodies and private litigants, and, as a result, may incur substantial costs in connection with those proceedings.

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Adverse litigation decisions or rulings may also damage our business reputation.

Often, our operations are conducted through joint ventures over which it may have limited influence and control.

Often, our operations are conducted through joint ventures over which we may have limited influence and control.

Private litigation or government proceedings brought against us could also result in significant delays in our operations.

Our failure to comply with applicable laws could subject us to penalties and other adverse consequences.

We are subject to a wide variety of laws relating to the environment, health and safety, taxes, employment, labor standards, money laundering, terrorist financing, and other matters in the jurisdictions in which they operate.

The compliance mechanisms and monitoring programs that we have adopted and implemented may not adequately prevent or detect possible violations of such applicable laws.

Investigations by governmental authorities could also have a material adverse effect on our business, results of operations and financial condition.

Risks Relating to the 2025 Facility Agreement

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Our failure to comply with these covenants could result in the acceleration of any future outstanding indebtedness under the 2025 Facility.

The Facility Agreement governing our Facility with Glencore contains certain affirmative and negative covenants, including, among other things, as to compliance with laws (including environmental laws and anti-corruption laws), delivery of quarterly and annual financial statements and borrowing base certificates, conduct of business, maintenance of property, maintenance of insurance, entry into certain derivatives contracts, restrictions on the incurrence of liens, indebtedness, asset dispositions, restricted payments.

In addition, the Facility Agreement (i) requires us to maintain a ratio of Consolidated Total Net Debt to EBITDAX (as each term is defined in the Facility Agreement) for the trailing 12 months not exceeding 3.0x;

(ii) requires us to maintain consolidated cash and cash equivalents shall not lower than $10.0 million;

and (iii) restricts our ability to:

dispose of assets, enter into guarantees or indemnities, enter into certain material contracts, merger or consolidate, or transfer all or substantially all of our assets and the assets of our subsidiaries, or pursue other corporate activities.

We were in compliance with covenants under the Facility Agreement as of December 31, 2023.

Restrictions contained in the Facility governing any future indebtedness may reduce our ability to incur additional indebtedness, engage in certain transactions or capitalize on acquisition or other business opportunities.

The 2025 Facility Agreement governing our 2025 Facility with The Standard Bank of South Africa Limited, Isle of Man Branch, The Standard Bank of South Africa Limited, and the other financial institutions contains certain affirmative and negative covenants, including, among other things, as to compliance with laws (including environmental laws and anti-corruption laws), delivery of quarterly and annual financial statements and compliance certificates, no change of business, no merger and maintenance of corporate existence, field preservations and related contracts relating to the Borrowing Base Assets (as defined in the 2025 Facility Agreement), maintenance of insurance, entry into certain derivatives contracts which are regulated by the 2025 Facility Agreement and the Hedging Policy (as defined in the 2025 Facility Agreement), restrictions on the incurrence of liens, indebtedness, asset dispositions, acquisitions, restricted payments, entry into offtake agreements with Qualifying Offtakers (as defined in the 2025 Facility Agreement) and other customary covenants.

The 2025 Facility Agreement also contains certain financial covenants and other covenants that restrict our ability to pay dividends and to enter into certain acquisitions and disposition transactions.

We were in compliance with covenants under the 2025 Facility Agreement as of the date hereof.

Restrictions contained in the 2025 Facility Agreement governing any future indebtedness may reduce our ability to incur additional indebtedness, engage in certain transactions or capitalize on proposed acquisition or other business opportunities.

Any future indebtedness under the 2025 Facility and other financial obligations and restrictions could have financial consequences.

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• increase our vulnerability to general adverse economic and industry conditions;

require us to dedicate a substantial portion of future cash flow to payments of our indebtedness and other financial obligations, thereby reducing the availability of our cash flow to fund working capital, capital expenditures and other general corporate requirements;

• require us to dedicate a substantial portion of future cash flows to payments of our indebtedness and other financial obligations, thereby reducing the availability of our cash flows to fund working capital, capital expenditures and other general corporate requirements;

• limit our flexibility in planning for, or reacting to, changes in our business and industry;

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Even if new financing was made available to us, it may not be on terms acceptable to us.

We may also be prevented from taking advantage of business opportunities that arise if we fail to meet certain ratios or because of the limitations imposed on us by the restrictive covenants under the Facility.

We may also be prevented from taking advantage of business opportunities that arise if we fail to meet certain ratios or because of the limitations imposed on us by the covenants under the 2025 Facility.

The borrowing base under the 2025 Facility may be reduced pursuant to the terms of the 2025 Facility Agreement, which may limit our available funding for exploration and development.

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In the future we may depend on the 2025 Facility for a portion of our capital needs.

The initial maximum borrowing base under the Facility is $50.0 million (which maximum was reduced to $43.8 million beginning on October 1, 2023) and is re-determined on March 31 and September 30 of each year.

Borrowings under the Facility are limited to a borrowing base amount calculated pursuant to the Facility Agreement based on our proved producing reserves and a portion of our proved undeveloped reserves.

The lenders will re-determine the borrowing base based on forecasts of cash flow and debt service projections with respect to the borrowing base assets, which may result in a reduction of the borrowing base.

The 2025 Facility has aggregate commitments of $190 million and an initial borrowing base of $182 million.

Subject to certain conditions, we may request, at any time prior to the date falling 30 months after the date of the 2025 Facility Agreement to increase the total commitments available under the 2025 Facility by an aggregate principal amount not to exceed $110 million.

The total amount of loans which may be drawn under the 2025 Facility is limited to the lower of the amount of the aggregate commitments and the Borrowing Base Amount at the relevant time.

The Borrowing Base Amount is calculated pursuant to the 2025 Facility Agreement and redetermined on March 31 and September 30 of each year beginning June 30, 2025 and other interim triggers set out in the 2025 Facility Agreement.

In the future, we may not be able to access adequate funding under the 2025 Facility as a result of (i) a decrease in our borrowing base due to the outcome of a subsequent borrowing base redetermination, or (ii) an unwillingness or inability on the part of the lenders to meet their funding obligations.

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The price of our Common Stock may fluctuate significantly.

Our common stock currently trades on the NYSE and the LSE, but an active trading market for our common stock may not be sustained.

Our common stock currently trades on the New York Stock Exchange (“NYSE”) and the London Stock Exchange (“LSE”), but an active trading market for our common stock may not be sustained.

The market price of our common stock could fluctuate significantly as a result of:

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If such increased levels of volatility and market turmoil continue, our operations could be adversely impacted, and the trading price of our common stock may be adversely affected.

We currently intend to pay dividends on, and effect share buybacks, with respect to our common stock;

however, our ability to take these actions in the future may be limited and no assurance can be given that we will be able to pay dividends to our stockholders or effect share buybacks in the future at indicated levels or at all.

We currently intend to pay dividends on our common stock;

however, no assurance can be given that we will be able to pay dividends to our stockholders in the future at indicated levels or at all.

On February 14, 2023, we announced that our Board of Directors adopted a quarterly cash dividend policy of an expected $0.0625 per share of common stock commencing in the first quarter of 2023.

On November 1, 2022, the Company announced that the Company’s board of directors formally ratified and approved a share buyback program.

The board of directors also directed management to implement a Rule 10b5-1 trading plan (the “10b5-1 Plan”) to facilitate share purchases through open market purchases, privately negotiated transactions, or otherwise in compliance with Rule 10b-18 under the Securities Exchange Act of 1934.

The 10b5-1 Plan provides for an aggregate purchase of currently outstanding common stock up to $30 million over a maximum period of 20 months.

Payment for shares repurchased under the share buyback program will be funded using the Company's cash on hand and cash flow from operations.

To the extent we have adequate cash on hand and cash flows from operations, we will consider continuing to take these actions in the future.

Payment of future dividends and effectuation of share buybacks, if any, and the establishment of future record and payment dates will be at the discretion of our board of directors after taking into account various factors, including current financial condition, the tax impact of repatriating cash, operating results and current and anticipated cash needs.

As a result, no assurance can be given that we will be able to continue to pay dividends to our stockholders or the terms on which we will effectuate share buybacks in the future or that the level of any future dividends will achieve a market yield or increase or even be maintained over time, any of which could materially and adversely affect the market price of our common stock.

To the extent we have adequate cash on hand and cash flows from operations, we will consider continuing to pay dividends on our common stock in the future.

Payment of future dividends, if any, and the establishment of future record and payment dates will be at the discretion of our Board of Directors after taking into account various factors, including current financial condition, the tax impact of repatriating cash, operating results and current and anticipated cash needs.

As a result, no assurance can be given that we will be able to continue to pay dividends to our stockholders or that the level of any future dividends will achieve a market yield or increase or even be maintained over time, any of which could materially and adversely affect the market price of our common stock.

Dual-listing on the NYSE and the LSE may lead to an inefficient market in our common stock.

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Substantial future sales of our common stock, or the perception that such sales might occur, or additional offerings of our common stock could depress the market price of our common stock.

We cannot predict what effect, if any, future sales of our common stock, or the availability of our common stock for future sale, or the offer of additional our common stock in the future, will have on the market price of our common stock.

Sales or an additional offering of substantial numbers of our common stock in the public market, or the perception or any announcement that such sales or an additional offering could occur, could adversely affect the market price of our common stock and may make it more difficult for stockholders to sell their common stock at a time and price that they deem appropriate and could also impede our ability to raise capital through the issuance of equity securities.

We cannot predict what effect, if any, future sales of our common stock, or the availability of our common stock for future sale, or the offer of additional shares of our common stock in the future, will have on the market price of our common stock.

Sales or an additional offering of substantial number of shares of our common stock in the public market, or the perception or any announcement that such sales or an additional offering could occur, could adversely affect the market price of our common stock and may make it more difficult for stockholders to sell their common stock at a time and price that they deem appropriate and could also impede our ability to raise capital through the issuance of equity securities.

Any issuance of preferred shares will rank in priority to our shares of common stock.

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We also issue shares of our common stock to our executive officers, employees and independent directors as part of their compensation.

This may have the effect of diluting the interests of existing stockholders.

Additionally, to the extent that pre-emptive rights are granted, stockholders in certain jurisdictions may experience difficulties or may be unable to exercise their pre-emptive rights.

This may have the effect of diluting the

interests of existing stockholders.

Additionally, to the extent that pre-emptive rights are granted, stockholders in certain jurisdictions may experience difficulties in exercising or the inability to exercise their pre-emptive rights.

The choice of forum provisions in our Third Amended and Restated Bylaws (the “ Bylaws ” ) could limit our stockholders ’ ability to obtain a favorable judicial forum for disputes.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors