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Income Taxes | 12 Months Ended
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Dec. 31, 2015
Income Tax [Abstract] |
Income Taxes | 11. INCOME TAXES VAALCO and its domestic subsidiaries file a consolidated United States income tax return. Certain subsidiaries’ operations are also subject to foreign income taxes. Provision for income taxes consists of the following:
|  | Year Ended December 31,
(in thousands) |  | 2015 |  | 2014 |  | 2013
U.S. Federal: |  |  |  |  |  |  |  |  |
Current |  | $ | - |  | $ | - |  | $ | -
Deferred |  |  | 1,349 |  |  | - |  |  | -
Foreign: |  |  |  |  |  |  |  |  |
Current |  |  | 13,238 |  |  | 22,486 |  |  | 34,115
Deferred |  |  | - |  |  | - |  |  | -
Total |  | $ | 14,587 |  | $ | 22,486 |  | $ | 34,115
The primary differences between the financial statement and tax bases of assets and liabilities resulted in deferred tax assets at December 31, 2015 and 2014 are as follows:
(in thousands) |  | 2015 |  | 2014
Deferred tax assets: |  |  |  |  |  |
Basis difference in fixed assets |  | $ | 98,890 |  | $ | 63,931
Foreign tax credit carry forward |  |  | 58,290 |  |  | 48,928
Alternative minimum tax credit carryover |  |  | 1,349 |  |  | 1,349
U.S. federal net operating losses |  |  | 13,878 |  |  | -
Foreign net operating losses |  |  | 64,187 |  |  | 44,228
Asset retirement obligations |  |  | 5,658 |  |  | 5,196
Basis difference in receivables |  |  | 4,148 |  |  | 3,510
Other |  |  | (649) |  |  | 318
Total deferred tax assets |  |  | 245,751 |  |  | 167,460
Valuation allowance |  |  | (245,751) |  |  | (166,111)
Net deferred tax assets |  | $ | - |  | $ | 1,349
Foreign tax credits will start to expire between the years 2017 and 2025. The alternative minimum tax credits do not expire, and foreign net operating losses (“NOLs”) are not subject to expiry dates. The NOL for our United Kingdom subsidiary can be carried forward indefinitely, while the NOLs for our Gabon and Angola subsidiaries are included in the respective subsidiaries’ cost oil accounts, which will be offset against future taxable revenues. The U.S federal NOL can be carried forward until 2035. Management assesses the available positive and negative evidence to estimate if existing deferred tax assets will be utilized. We do not anticipate utilization of the foreign tax credits prior to expiration nor do we expect to generate sufficient taxable income to utilize other deferred tax assets. On the basis of this evaluation, valuation allowances of $245.8 million, $166.1 million and $137.3 million have been recorded as of December 31, 2015, 2014 and 2013. Valuation allowances reduce the deferred tax asset to the amount that is more likely than not to be realized. As a result of activity in the U.S. in 2015, a full valuation allowance was recorded related to AMT credits and our expectation that these credits will not be utilized in the foreseeable future. Income (loss) before income taxes is attributable as follows:
|  | Year Ended December 31,
(in thousands) |  | 2015 |  | 2014 |  | 2013
United States |  | $ | (15,177) |  | $ | (6,349) |  | $ | (17,649)
Foreign |  |  | (128,892) |  |  | (48,715) |  |  | 94,836
|  | $ | (144,069) |  | $ | (55,064) |  | $ | 77,187
The reconciliation to the U.S. statutory rate is as follows:
|  | Year Ended December 31,
(in thousands) |  | 2015 |  | 2014 |  | 2013
Tax provision computed at U.S. statutory rate |  | $ | (50,424) |  | $ | (19,273) |  | $ | 27,015
Foreign taxes not offset in U.S. by foreign tax credits |  |  | (19,445) |  |  | 4,433 |  |  | (2,072)
Effect of change in foreign statutory rates |  |  | 3,014 |  |  |  |  |  |
Permanent differences |  |  | 1,802 |  |  | 135 |  |  | 973
Foreign tax credit adjustments |  |  | - |  |  | 8,417 |  |  | (28,027)
Increase/(decrease) in valuation allowance |  |  | 79,640 |  |  | 28,762 |  |  | 37,752
Other |  |  | - |  |  | 12 |  |  | (1,526)
Total income tax expense |  | $ | 14,587 |  | $ | 22,486 |  | $ | 34,115
At December 31, 2015, 2014 and 2013, we were subject to foreign and U.S. federal taxes only, with no allocations made to state and local taxes. The following table summarizes the tax years that remain subject to examination by major tax jurisdictions:
Jurisdiction |  | Years
United States |  | 2008-2015
Gabon |  | 2007-2015

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319 + Details
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