INCOME TAXES |
3 Months Ended |
|---|---|
Mar. 31, 2026 | |
| Income Tax Disclosure [Abstract] | |
| INCOME TAXES | INCOME TAXES Vaalco and its domestic subsidiaries file a consolidated U.S. federal income tax return. Certain foreign subsidiaries also file tax returns in their respective local jurisdictions including Canada, Egypt, Equatorial Guinea, Gabon, Côte d'Ivoire and Nigeria. The foreign taxes payable are attributable to Gabon and Côte d'Ivoire as of March 31, 2026 and 2025. The Company’s effective tax rate for the three months ended March 31, 2026 and 2025, excluding the impact of discrete items, was 41.87% and 62.58%, respectively. For the three months ended March 31, 2026 and 2025, the Company’s overall effective tax rate was primarily impacted by tax rates in foreign jurisdictions higher than the U.S. statutory rate and by non-deductible items associated with operations. For the three months ended March 31, 2026, the income tax expense of $4.3 million includes a $2.9 million unfavorable oil price adjustment as a result of the change in value of the government of Gabon's allocation of Profit Oil between the time it was produced and the time it was taken in-kind. After excluding this impact, income taxes were $1.4 million for the period. As of March 31, 2026, the Company had no material uncertain tax positions. The Company’s policy is to recognize potential interest and penalties related to unrecognized tax benefits as a component of income tax expense. In January 2026, the Company received an assessment from the Canada Revenue Agency in connection with this examination. Following the sale of its Canadian assets, the Company elected not to file an objection or pursue other remedies. As a result, the Company reduced its Canadian net operating loss carryforwards and the related valuation allowance carried forward from December 31, 2025. This adjustment did not have a material impact on the Company’s consolidated financial position, results of operations, cash flows, or income tax expense.
|