VAALCO ENERGY (EGY)

Audit Committee

The Audit Committee assists the Board of Directors in fulfilling its responsibility for overseeing the quality and integrity of the Company’s accounting, auditing and financial reporting practices. In carrying out this responsibility, the Audit Committee (i) reviews with the Company’s independent auditors the scope of the annual audit, (ii) reviews the independent auditors’ management letter and (iii) meets with the Company’s internal auditors. In 2003, the Board of Directors adopted an audit committee charter, which is available on the Company’s website at www.vaalco.com. The Audit Committee is comprised of Mr. Allen (Chairman), Mr. Nielsen, Mr. Chapoton and Mr. Caflisch. The Board of Directors has determined that Mr. Allen is a financial

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expert, as defined by the Securities Exchange Act of 1934. The Board of Directors has determined that all members of the Company’s Audit Committee are financially literate and independent, based on the definition of independence in the American Stock Exchange’s listing standards and applicable federal securities laws. The Board of Directors believes that all members of the Audit Committee possess the financial expertise necessary for the Audit Committee to properly fulfill its purpose. During 2005, the Audit Committee held four meetings. At two of the meetings all members were present. At the other two meetings one member was absent.

Audit Committee

The Audit Committee assists the Board of Directors in fulfilling its responsibility for overseeing the quality and integrity of the Company’s accounting, auditing and financial reporting practices. In carrying out this responsibility, the Audit Committee (i) reviews with the Company’s independent auditors the scope of the annual audit, (ii) reviews the independent auditors’ management letter and (iii) meets with the Company’s internal auditors. In 2003, the Board of Directors adopted an audit committee charter, which is available on the Company’s website at www.vaalco.com. The Audit Committee is comprised of Mr. Allen (Chairman), Mr. Nielsen and Mr. Farish. The Board of Directors has determined that Mr. Allen is a financial expert, as defined by the Securities Exchange Act of 1934. The Board of Directors has determined that all members of the Company’s Audit Committee are financially literate and independent, based on the definition of independence in the American Stock Exchange’s listing standards and applicable federal securities laws. The Board of Directors believes that all members of the Audit Committee possess the financial expertise necessary for the Audit Committee to properly fulfill its purpose. During 2004, the Audit Committee held three meetings at which all members were present.