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INCOME TAXES
 9 Months Ended
Sep. 30, 2025
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 September 30, 2025 and 2024.
The Company’s effective tax rate for the three months ended September 30, 2025, and 2024, excluding the impact of discrete items, was (81.21)% and 64.85%, respectively. The Company’s effective tax rate for the nine months ended September 30, 2025 and 2024, excluding the impact of discrete items, was 59.48% and 59.10%, respectively. For the three and nine months ended September 30, 2025 and 2024, the Company’s overall effective tax rate was primarily impacted by tax rates in foreign jurisdictions higher than the US statutory rate and by non-deductible items associated with operations.

For the three months ended September 30, 2025, the income tax benefit of $3.6 million includes a $3.9 million favorable 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 $0.3 million for the period. For the nine months ended September 30, 2025, the income tax expense of $19.5 million includes a $6.4 million favorable 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 $25.9 million for the period.

As of September 30, 2025, 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.

Enactment of the One Big Beautiful Bill Act of 2025

On July 4, 2025, the budget reconciliation bill known as the One Big Beautiful Bill Act of 2025 (“OBBBA”) was signed into law, which includes significant changes to federal tax law and other regulatory provisions that may impact the Company. Among other provisions, the OBBBA makes permanent key elements of the Tax Cuts and Jobs Act of 2017. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The impact of provisions effective in 2025 are not material and the Company is still assessing the impact of provisions that are not yet effective.