VAALCO Energy has announced that it has reached an agreement with Transocean on the outstanding contract term for the Constellation II rig, which was hired for a recent drilling program offshore Gabon.

The agreement is subject to the payment of $5.1 million net to VAALCO’s interest for the days the rig was idle. This money which includes demobilization charges, is to be paid within seven months.

In June, the electrical submersible pumps (ESPs) in the South Tchibala 2-H well failed, thereby shutting in a 1,700 bopd production.

VAALCO plans to organize a hydraulic workover unit to move into the Avouma platform to substitute the ESPs in the well, which is expected to resume production by early Q4 of 2016.

“Thus far in 2016, we have experienced very high production uptime along with more shallow declines from new wells placed on production in the last 12 months. The shut-in of the South Tchibala 2-H well is expected to be only a short-term temporary disruption, therefore we don’t see a need to change our current annual production guidance of 3,700 to 4,500 boe/d at this time,” Steve Guidry (photo), CEO of VAALCO told Offshore news.

Anita Fatunji