EBOURI 1 HITS PAY : GABON ETAME OPERATOR ANNOUNCES EBOURI DISCOVERY

EXCERPT FROM NEWS REPORT ISSUED BY VAALCO, January 21, 2004 :

" VAALCO Energy reports that the wildcat well Ebouri No. 1 ("EBO-1"), reached total depth offshore Gabon, and logged approximately 15 meters (48 feet) of net oil pay in 17 meters (55 feet) of gross Gamba sandstone section. The Ebouri well is being drilled on a prospect 11 kilometers (7 miles) away from the Etame field, which VAALCO produces at approximately 15,000 barrels oil per day. The Gamba sandstone section in the EBO-1 well is the same reservoir as in the Etame field. Both accumulations lie within the 3,073 square kilometer Etame Block, which VAALCO has operated since 1995.

The EBO-1 well was subsequently successfully sidetracked to confirm the accumulation and encountered approximately the same amount of net pay within the Gamba sandstone section at the sidetracked location. Wireline logging operations are currently in progress to obtain formation information, and to attempt to get an oil sample from the well. "