EXHIBIT 10.28

THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED FOR SALE, SOLD
OR OTHERWISE DISPOSED OF IN THE UNITED STATES OR TO UNITED STATES PERSONS EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH
ACT.

VOID AFTER 5:00 P.M., NEW YORK TIME, ON July 31, 2002, OR IF NOT A BUSINESS DAY,
AS DEFINED HEREIN, AT 5:00 P.M., NEW YORK TIME, ON THE NEXT BUSINESS DAY.

WARRANT TO PURCHASE
COMMON STOCK OF

VAALCO ENERGY, INC.

This certifies that, for good and valuable consideration, the
sufficiency of which is hereby acknowledged, Jefferies & Company, Inc., and its
registered, permitted assigns (collectively, the "Warrantholder"), is entitled
to purchase from Vaalco Energy, Inc., a corporation incorporated under the laws
of the state of Delaware (the "Company"), subject to the terms and conditions
hereof, at any time before 5:00 P.M., New York time, on July 31, 2002, (or, if
such day is not a Business Day, at or before 5:00 P.M., New York time, on the
next following Business Day), 345,325 shares of fully paid and nonassessable
Common Stock, par value $.10 per share at the Exercise Price. The Exercise Price
and the number of shares purchasable hereunder are subject to adjustment from
time to time as provided in Article III hereof.

ARTICLE I

SECTION 1.01: DEFINITION OF TERMS. As used in this Warrant, the
following capitalized terms shall have the following respective meanings:

(a) BUSINESS DAY: A day other than a Saturday, Sunday or other
day on which banks in the State of New York are authorized by law to
remain closed.

(b) COMMON STOCK: Common Shares, $.10 par value, of the Company.

(c) COMMON STOCK EQUIVALENTS: Securities that are convertible
into or exercisable for shares of Common Stock.

(d) EXCHANGE ACT: The Securities Exchange Act of 1934, as
amended.

(e) EXERCISE PRICE: U.S. $1.00 per Warrant Share, as
such price may be adjusted from time to time pursuant to Article III
hereof.

(f) EXPIRATION DATE: 5:00 P.M., New York time, on July 31, 2002,
or if such day is not a Business Day, the next succeeding day which is a
Business Day.
(g) HOLDER: A Holder of Warrants.

(h) NASD: National Association of Securities Dealers, Inc., and
NASDAQ: NASD Automatic Quotation System.

(i) PERSON: An individual, partnership, joint venture,
corporation, trust, unincorporated organization or government or any
department or agency thereof.

(j) SEC: The Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act or the
Exchange Act.

(k) SECURITIES ACT: The Securities Act of 1933, as amended.

(l) WARRANTS: This Warrant and all other warrants that may be
issued in its or their place (together evidencing the right to purchase
an aggregate of 345,325 shares of Common Stock), originally issued to
Jefferies & Company, Inc.

(m) WARRANTHOLDER: The person(s) or entity(ies) to whom this
Warrant is originally issued, or any successor in interest thereto, or
any assignee or transferee thereof, in whose name this Warrant is
registered upon the books to be maintained by the Company for that
purpose.

(n) WARRANT SHARES: Common Stock, Common Stock Equivalents and
other securities purchased or purchasable upon exercise of the Warrants.

(o) $ or DOLLARS: United States dollars.

ARTICLE II

DURATION AND EXERCISE OF WARRANT

SECTION 2.01: DURATION OF WARRANT. The Warrantholder may exercise this
Warrant at any time and from time to time before 5:00 P.M., New York time, on
the Expiration Date. If this Warrant is not exercised on the Expiration Date, it
shall become void, and all rights hereunder shall thereupon cease.

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SECTION 2.02: EXERCISE OF WARRANT.

(a) The Warrantholder may exercise this Warrant, in whole or in
part, as follows:

(i) by presentation and surrender of this warrant to the
Company at its corporate office at 4600 Post Oak Place, Suite
309, Houston, Texas 77027, or at the office of its stock transfer
agent, if any, with the Subscription Form annexed hereto duly
executed and accompanied by payment of the full Exercise Price
for each Warrant Share to be purchased by means of a cashiers or
certified check; or

(ii) By presentation and surrender of this Warrant to the
Company at its principal executive offices with a Cashless
Exercise Form annexed hereto duly executed (a "Cashless
Exercise"). In the event of a Cashless Exercise, the
Warrantholder shall exchange its warrant for that number of
shares of Common Stock determined by multiplying the number of
Warrant Shares by a fraction, the numerator of which shall be the
amount by which the then current market price per share of Common
Stock exceeds the Exercise Price, and the denominator of which
shall be the then current market price per share of Common Stock.
For purposes of any computation under this Section 2.02(a)(ii),
the then current market price per share of Common Stock at any
date shall be deemed to be the last sale price of the Common
Stock on the business day prior to the date of the Cashless
Exercise or, in case no such reported sales take place on such
day, the average of the last reported bid and asked prices of the
Common Stock on such day, in either case on the principal
national securities exchange on which the Common Stock is
admitted to trading or listed, or if not listed or admitted to
trading on any such exchange, the representative closing bid
price of the Common Stock as reported by NASDAQ, or other similar
organization if NASDAQ is no longer reporting such information,
or if not so available, the fair market price of the Common Stock
as determined by the Board of Directors in good faith.

(b) Upon receipt of this Warrant with the Subscription Form fully
executed and accompanied by payment of the aggregate Exercise Price for
the Warrant Shares for which this Warrant is then being exercised, or,
in the case of Section 2.02(a)(ii), with the Cashless Exercise Form duly
executed, the Company shall cause to be issued certificates for the
total number of whole shares of Common Stock for which this Warrant is
being exercised (adjusted to reflect the effect of the anti-dilution
provisions contained in Article III hereof, if any, and as provided in
Section 2.04 hereof) in such denominations as are requested for delivery
to the Warrantholder, and the Company shall thereupon deliver such
certificates to the Warrantholder. The Warrantholder shall be deemed to
be the holder of record of the shares of Common Stock issuable upon such
exercise, notwithstanding that the stock transfer books of the Company
shall then be closed or that certificates representing such shares of
Common Stock may not then be actually delivered to the Warrantholder. If
at the time this Warrant is exercised, a Registration Statement is not
in effect to register under the Securities Act the Warrant Shares
issuable upon exercise of this Warrant, the Company may require the
Warrantholder to make such representations, and may place such legends
on certificates

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representing the Warrant Shares, as may be reasonably required in the
opinion of counsel to the Company to permit the Warrant Shares to be
issued without such registration.

(c) In case the Warrantholder shall exercise this Warrant with
respect to less than all of the Warrant Shares that may be purchased
under this Warrant, the Company shall execute a new warrant in the form
of this Warrant for the balance of such Warrant Shares and deliver such
new warrant to the Warrantholder.

(d) The Company shall pay any and all stock transfer and similar
taxes which may be payable in respect of the issue of this Warrant or in
respect of the issue of any Warrant Shares.

SECTION 2.03: RESERVATION OF SHARES. The Company hereby agrees that at
all times there shall be reserved for issuance and delivery upon exercise of
this Warrant such number of shares of Common Stock or other shares of capital
stock of the Company from time to time issuable upon exercise of this Warrant.
All such shares shall be duly authorized, and when issued upon such exercise,
shall be validly issued, fully paid and non-assessable, free and clear of all
liens, security interests, charges and other encumbrances or restrictions on
sale and free and clear of all preemptive rights.

SECTION 2.04: FRACTIONAL SHARES. The Company shall not be required to
issue any fraction of a share of its capital stock in connection with the
exercise of this Warrant, and in any case where the Warrantholder would, except
for the provisions of this Section 2.04, be entitled under the terms of this
Warrant to receive a fraction of a share upon the exercise of this Warrant, the
Company shall, upon the exercise of this Warrant and receipt of the Exercise
Price, issue the greatest number of whole shares purchasable upon exercise of
this Warrant for which payment in full of the Exercise Price has been received.
The Company shall not be required to make any cash or other adjustment in
respect of such fraction of a share to which the Warrantholder would otherwise
be entitled.

SECTION 2.05: LISTING. Prior to the issuance of any shares of Common
Stock upon exercise of this Warrant, the Company shall secure the listing of
such shares of Common Stock upon each national securities exchange or automated
quotation systems, if any, upon which shares of Common Stock are then listed
(subject to official notice of issuance upon exercise of this Warrant) and shall
maintain, so long as any other shares of Common Stock shall be so listed, such
listing of all shares of Common Stock from time to time issuable upon the
exercise of this Warrant; and the Company shall so list on each national
securities exchange or automated quotation system, and shall maintain such
listing of, any other shares of capital stock of the Company issuable upon the
exercise of this Warrant if and so long as any shares of the same class shall be
listed on such national securities exchange or automated quotation system.

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ARTICLE III

ADJUSTMENT OF SHARES OF COMMON STOCK
PURCHASABLE AND EXERCISE PRICE

The Exercise Price and the number and kind of Warrant Shares shall be
subject to adjustment from time to time upon the happening of certain events as
provided in this Article III.

SECTION 3.01: MECHANICAL ADJUSTMENTS.

(a) If at any time prior to the exercise of this Warrant in full,
the Company shall (i) declare a dividend or make a distribution on the
Common Stock payable in shares of its Common Stock; (ii) subdivide,
reclassify or recapitalize the outstanding Common Stock into a greater
number of shares of Common Stock; (iii) combine, reclassify or
recapitalize its outstanding shares of Common Stock into a smaller
number of shares of Common Stock, or (iv) issue any shares of its
capital stock by reclassification of its Common Stock (including any
such reclassification in connection with a consolidation or a merger in
which the Company is the continuing corporation), the Exercise Price in
effect at the time of the record date of such dividend, distribution,
subdivision, combination, reclassification or recapitalization shall be
adjusted so that the Warrantholder shall be entitled to receive the
aggregate number and kind of shares which, if this Warrant had been
exercised in full immediately prior to such event, he would have owned
upon such exercise and been entitled to receive by virtue of such
dividend, distribution, subdivision, combination, reclassification or
recapitalization. Any adjustment required by this paragraph 3.01(a)
shall be made successively and become effective immediately after the
record date, in the case of a dividend or distribution, or the effective
date, in the case of a subdivision, combination, reclassification or
recapitalization, to allow the purchase of such aggregate number and
kind of shares.

(b) If at any time prior to the exercise of this Warrant in full,
the Company shall (i) issue or sell any Common Stock or Common Stock
Equivalents without consideration or for consideration per share of
Common Stock less than the current market price per share of Common
Stock on the date of such issuance or sale as defined in Section 3.01(e)
(other than pursuant to employee benefit or compensation arrangements
and other than pursuant to subscription rights, options or warrants
which had a subscription, exercise, purchase or conversion price equal
to or greater than the current market price per share on the effective
date of issuance or grant of such rights, options or warrants) or (ii)
fix a record date for the issuance of subscription rights, options or
warrants to all holders of Common Stock entitling them to subscribe for
or purchase shares of Common Stock (or Common Stock Equivalents) at a
price (or having an exercise or conversion price per share) less than
the current market price of the Common Stock (as determined pursuant to
Section 3.01(e)) on the record date described below, the Exercise Price
shall be adjusted so that the Exercise Price shall equal the price
determined by multiplying the Exercise Price in effect immediately prior
to the date of such sale or issuance (which date in the event of
distribution to shareholders shall be deemed to be the record date set
by the Company to determine shareholders entitled to participate in such
distribution) by a fraction, the numerator of which shall be (i) the
number of shares of Common Stock outstanding on the date of such sale or
issuance, plus (ii) the number of

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additional shares of Common Stock which the aggregate consideration
received by the Company upon such issuance or sale (plus the aggregate
of any additional amount to be received by the Company upon the exercise
of such subscription rights, options or Warrants) would purchase at such
current market price per share of the Common Stock immediately prior to
the date of such issuance or sale; and the denominator of which shall be
(i) the number of shares of Common Stock outstanding on the date of such
issuance or sale, plus (ii) the number of additional shares of Common
Stock offered for subscription or purchase (or into which the Common
Stock equivalents so offered are exercisable or convertible). Any
adjustments required by this paragraph 3.01(b) shall be made immediately
after such issuance or sale or record date, as the case may be unless
the offering period of such Common Stock or Common Stock Equivalents, or
the period in which such rights, options or warrants may be exercised or
converted, shall expire in 90 days or less, in which case such event
shall be given effect immediately after the expiration of such period
based upon the number of shares of Common Stock (or Common Stock
Equivalents) actually delivered; provided that should any Warrant be
exercised during such period, the number of shares of Common Stock
issuable upon such exercise shall be recalculated giving effect to any
adjustment made at the end of such period in respect of such event and
an appropriate number of additional shares of Common Stock shall be
issued in respect of such exercise. Such adjustments shall be made
successively whenever such event shall occur. In the event that such
period shall be greater than 90 days, then to the extent that shares of
Common Stock (or Common Stock Equivalents) are not delivered after the
expiration of such subscription rights, options or warrants, the
Exercise Price shall be readjusted to the Exercise Price which would
then be in effect had the adjustments made upon the issuance of such
rights, options or warrants been made upon the basis of delivery of only
the number of shares of Common Stock (or Common Stock Equivalents)
actually delivered.

(c) If at any time prior to the exercise of this Warrant in full,
the Company shall fix a record date for the issuance or making a
distribution to all holders of the Common Stock (including any such
distribution to be made in connection with a consolidation or merger in
which the Company is to be the continuing corporation) of evidences of
its indebtedness, any other securities of the Company or any cash,
property or other assets or securities, including without limitation
shares of a subsidiary's capital stock (excluding a common stock
dividend, combination, reclassification, recapitalization or issuance
referred to in Section 3.01(a)), regular cash dividends or cash
distributions in the ordinary course of business or subscription rights,
options or warrants for Common Stock or Common Stock Equivalents
(excluding those referred to in Section 3.01(b)) (any such nonexcluded
event being herein called a "Special Dividend"), the Exercise Price
shall be decreased immediately after the record date for such Special
Dividend to a price determined by multiplying the Exercise Price then in
effect by a fraction, the numerator of which shall be the then current
market price of the Common Stock (as defined in Section 3.01(e)) on such
record date less the fair market value (as determined by the Company's
Board of Directors) of the evidences of indebtedness, securities or
property, or other assets issued or distributed in such Special Dividend
applicable to one share of Common Stock or of such subscription rights
or warrants applicable to one share of Common Stock, and the denominator
of which shall be the then current market price per share of Common
Stock (as so determined). Any adjustment required by this paragraph
3.01(c) shall be made successively effective on the record date for the
Special Dividend and

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in the event that such distribution is not so made, the Exercise Price
shall again be adjusted to be the Exercise Price that was in effect
immediately prior to such record date.

(d) If at any time prior to the exercise of this Warrant in full,
the Company shall make a distribution to all holders of the Common Stock
of stock of a subsidiary or securities convertible into or exercisable
for such stock, then in lieu of an adjustment in the Exercise Price or
the number of Warrant Shares purchasable upon the exercise of this
Warrant, each Warrantholder, upon the exercise hereof at any time after
such distribution, shall be entitled to receive from the Company, such
subsidiary or both, as the Company shall determine, the stock or other
securities to which such Warrantholder would have been entitled if such
Warrantholder had exercised this Warrant immediately prior thereto, all
subject to further adjustment as provided in this Article III, and the
Company shall reserve, for the life of the Warrant, such securities of
such subsidiary or other corporation; provided, however, that no
adjustment in respect of dividends or interest of such stock or other
securities shall be made during the term of this Warrant or upon its
exercise.

(e) Whenever the Exercise Price payable upon exercise of each
Warrant is adjusted pursuant to one or more of paragraphs (a), (b) and
(c) of this Section 3.01, the Warrant Shares shall simultaneously be
adjusted by multiplying the number of Warrant Shares initially issuable
upon exercise of each Warrant by the Exercise Price in effect on the
date thereof and dividing the product so obtained by the Exercise Price,
as adjusted.

(f) For the purpose of any computation under this Section 3.01,
the current market price per share of Common Stock at any date shall be
deemed to be the average of the daily closing prices for 20 consecutive
trading days commencing 30 trading days before such date. The closing
price for each day shall be the last sale price regular way or, in case
no such reported sales take place on such day, the average of the last
reported bid and asked prices regular way, in either case on the
principal national securities exchange on which the Common Stock is
admitted to trading or listed, or if not listed or admitted to trading
on such exchange, the representative closing bid price as reported by
NASDAQ, or other similar organization if NASDAQ is no longer reporting
such information, or if not so available, the fair market price as
determined in good faith by the Board of Directors of the Company.

(g) No adjustment in the Exercise Price shall be required unless
such adjustment would require an increase or decrease of at least five
cents ($.05) in such price; provided, however, that any adjustments
which by reason of this paragraph (g) are not required to be made shall
be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 3.01 shall be made to the nearest
cent or to the nearest one-hundredth of a share, as the case may be.
Notwithstanding anything in this Section 3.01 to the contrary, the
Exercise Price shall not be reduced to less than the then existing par
value, if any, of the Common Stock as a result of any adjustment made
hereunder.

(h) In the event that at any time, as a result of any adjustment
made pursuant to Section 3.01(a), the Warrantholder thereafter shall
become entitled to receive any shares of the Company other than Common
Stock, thereafter the number of such other shares so receivable upon
exercise of any Warrant shall be subject to adjustment from time to time
in

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a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Common Stock contained in Section
3.01(a).

(i) In the case of an issue of additional Common Stock or Common
Stock Equivalents for cash, the consideration received by the Company
therefor, without deducting therefrom any discount or commission or
other expenses paid by the Company for any underwriting of, or otherwise
in connection with, the issuance thereof, shall be deemed to be the
amount received by the Company therefor. To the extent that such
issuance shall be for a consideration other than cash, then, except as
herein otherwise expressly provided, the amounts of such consideration
shall be deemed to be the fair value of such consideration at the time
of such issuance as reasonably determined in good faith by the Board of
Directors of the Company (but without deduction of any compensation,
discounts or expenses paid or incurred by the Company for, and in the
underwriting of, or otherwise in connection with, the issuance thereof).
The term issue shall include the sale or other disposition of shares
held by or on account of the Company or in the treasury of the Company
but until so sold or otherwise disposed of such shares shall not be
deemed outstanding.

SECTION 3.02: NOTICES OF ADJUSTMENT. Whenever the number of Warrant
Shares or the Exercise Price is adjusted as herein provided, the Company shall
prepare and deliver forthwith to the Warrantholder a certificate signed by its
President, and by any Vice President, Treasurer or Secretary, setting forth the
adjusted number of shares purchasable upon the exercise of this Warrant and the
Exercise Price of such shares after such adjustment, setting forth a brief
statement of the facts requiring such adjustment and setting forth the
computation by which adjustment was made. The certificate of any independent
firm of public accountants of recognized standing selected by the Board of
Directors of the Company shall be conclusive evidence of the arithmetic
correctness of any computation made under this Section 3.

SECTION 3.03: NO ADJUSTMENT FOR DIVIDENDS. Except as provided in Section
3.01 of this Agreement, no adjustment in respect of any cash dividends shall be
made during the term of this Warrant or upon the exercise of this Warrant.

SECTION 3.04: PRESERVATION OF PURCHASE RIGHTS IN CERTAIN TRANSACTIONS.
In case of any consolidation or merger of the Company with or into another
corporation (other than a merger with a subsidiary in which the Company is the
continuing corporation and that does not result in any reclassification, capital
reorganization or other change of outstanding shares of Common Stock) or in case
of any sale, lease, transfer or conveyance to another corporation of the
property and assets of the Company as an entirety or substantially as an
entirety, the Company shall, as a condition to such transaction cause such
successor or purchasing corporation, as the case may be, to execute with the
Warrantholder an agreement granting the Warrantholder the right thereafter, upon
payment of the Exercise Price in effect immediately prior to such transaction,
to receive upon exercise of this Warrant the kind and amount of shares and other
securities and property which he would have owned or have been entitled to
receive as a result of such transaction had this Warrant been exercised
immediately prior to such action. Such agreement shall provide for adjustments
in respect of such shares of stock and other securities and property, which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Article III and shall provide that such rights may be exercised at
any time prior to the Expiration Date. In the event that in connection with any
such

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transaction, additional shares of Common Stock shall be issued in exchange,
conversion, substitution or payment, in whole or in part, for, or of, a security
of the Company other than Common Stock, any such issue shall be treated as an
issue of Common Stock covered by the provisions of Article III. The provisions
of this Section 3.04 shall similarly apply to successive reclassifications,
capital reorganizations, consolidations, mergers, sales or conveyance.

SECTION 3.05: FORM OF WARRANT AFTER ADJUSTMENTS. The form of this
Warrant need not be changed because of any adjustments in the Exercise Price or
the number or kind of the Warrant Shares, and Warrants theretofore or thereafter
issued may continue to express the same price and number and kind of shares as
are stated in the Warrant, as initially issued.

SECTION 3.06: TREATMENT OF WARRANTHOLDER. Prior to due presentment for
registration of transfer of this Warrant, the Company may deem and treat the
Warrantholder as the absolute owner of this Warrant (notwithstanding any
notation of ownership or other writing hereon) for all purposes and shall not be
affected by any notice to the contrary.

ARTICLE IV

OTHER PROVISIONS RELATING TO

RIGHTS OF WARRANTHOLDER

SECTION 4.01: NO RIGHTS AS SHAREHOLDERS: NOTICE TO WARRANTHOLDERS.
Nothing contained in this Warrant shall be construed as conferring upon the
Warrantholder or his or its transferees the right to vote or to receive
dividends or to consent or to receive notice as a shareholder in respect of any
meeting of shareholders for the election of directors of the Company or of any
other matter, or any rights whatsoever as shareholders of the Company. The
Company shall give notice to the Warrantholder by registered mail if at any time
prior to the expiration or exercise in full of the Warrants, any of the
following events shall occur:

(a) the Company shall authorize the payment of any dividend
to all holders of Common Stock;

(b) the Company shall authorize the issuance to all holders of
Common Stock of any additional shares of Common Stock or Common Stock
Equivalents or of rights, options or warrants to subscribe for or
purchase Common Stock or Common Stock Equivalents or of any other
subscription rights, options or warrant;

(c) a dissolution, liquidation or winding up of the Company; or

(d) a capital reorganization or reclassification of the Common
Stock (other than a subdivision or combination of the outstanding Common
Stock) or any consolidation or merger of the Company with or into
another corporation (other than a consolidation or merger in which the
Company is the continuing corporation and that does not result in any
reclassification or change of Common Stock outstanding) or in the case
of any sale or conveyance to another corporation of the property of the
Company as an entirety or substantially as an entirety.

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Such giving of notice shall be completed at least 15 Business Days prior to the
date fixed as a record date or effective date or the date of closing of the
Company's stock transfer books for the determination of the shareholders
entitled to such dividend, distribution, or subscription rights, or for the
determination of the shareholders entitled to vote on such proposed merger,
consolidation, sale, conveyance dissolution, liquidation or winding up. Such
notice shall specify such record date or the date of closing the stock transfer
books, as the case may be. Failure to provide such notice shall not affect the
validity of any action taken in connection with such dividend, distribution or
subscription rights, or proposed merger, consolidation, sale, conveyance,
dissolution, liquidation or winding up.

SECTION 4.02: LOST, STOLEN, MUTILATED OR DESTROYED WARRANTS. If this
Warrant is lost, stolen, mutilated or destroyed, the Company may, upon receipt
by the Company of evidence of ownership reasonably satisfactory to it and on
such terms as to indemnity or otherwise as it may in its discretion impose
(which shall, in the case of a mutilated Warrant, include the surrender
thereof), issue a new Warrant of like denomination and tenor as, and in
substitution for, this Warrant.

SECTION 4.03: SPLIT-UP, COMBINATION, EXCHANGE AND TRANSFER OF WARRANTS.
This Warrant may be split up, combined or exchanged for another Warrant or
Warrants containing the same terms to purchase a like aggregate number of
Warrant Shares. If the Warrantholder desires to split up, combine or exchange
this Warrant, he or it shall make such request in writing delivered to the
Company and shall surrender to the Company this Warrant and any other Warrants
to be so split-up, combined or exchanged. Upon any such surrender for a
split-up, combination or exchange, the Company shall execute and deliver to the
person entitled thereto a Warrant or Warrants, as the case may be, as so
requested. The Company shall not be required to effect any split-up, combination
or exchange which will result in the issuance of a Warrant entitling the
Warrantholder to purchase upon exercise a fraction of a share of Common Stock or
a fractional Warrant.

SECTION 4.04: REGISTRATION RIGHTS. The Warrant and the Warrant Shares,
once issued, are subject to the rights and benefits of the Registration Rights
Agreement dated, July 31, 1997, between the Company, Jefferies & Company, Inc.,
and others; provided, however, that notwithstanding anything in such
Registration Rights Agreement to the contrary, the Company hereby consents to
the transfer of the registration rights contained therein with respect to the
Warrant and the Warrant Shares to the extent that transfers of the Warrant and
the Warrant Shares are permitted hereunder.

ARTICLE V
OTHER MATTERS

SECTION 5.01: AMENDMENTS AND WAIVERS. The provisions of this Warrant,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waiver or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of Holders
of at least a majority of the outstanding Warrants. Holders shall be bound by
any consent authorized by this Section whether or not Certificates representing
such Warrants have been marked to indicate such consent.
SECTION 5.02: GOVERNING LAW. This Warrant shall be governed by and
construed in accordance with the laws of the State of New York, U.S.A.

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SECTION 5.03: SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provisions in every other respect and of the
remaining provisions contained herein shall not be affected or impaired thereby.

SECTION 5.04: ATTORNEYS' FEES. In any action or proceeding brought to
enforce any provisions of this Warrant, or where any provisions hereof or
thereof are validly asserted as a defense, the successful party shall be
entitled to recover reasonable attorneys' fees and disbursements in addition to
its costs and expenses and any other available remedy.

SECTION 5.05: COMPUTATIONS OF CONSENT. Whenever the consent or approval
of Holders of a specified percentage of Warrants is required hereunder, Warrants
held by the Company or its affiliates (other than the Warrantholder or
subsequent Holders if they are deemed to be such affiliates solely by reason of
their holdings of such Warrants) shall not be counted in determining whether
such consent or approval was given by the Holders of such required percentage.

SECTION 5.06: NOTICE. Any notices or certificates by the Company to the
Holder and by the Holder to the Company shall be deemed delivered if in writing
and delivered in person or by registered mail (return receipt requested) to the
Holder addressed to him in care of Jefferies & Company, Inc., 650 Fifth Avenue,
4th Floor, New York, New York 10019, or, if the Holder has designated by notice
in writing to the Company any other address, to such other address, and if to
the Company, addressed to it at:

4600 Post Oak Place, Suite 309
Houston, Texas 77027

The Company may change its address by written notice to the Holder and
the Holder may change its address by written notice to the Company.

SECTION 5.07: INVESTMENT REPRESENTATION OF THE HOLDER. By accepting
delivery of this Warrant, the Holder represents to the Company that it has
acquired this Warrant solely for its own account for investment and not with a
view to distribution or sale in violation of the Securities Act, but subject,
nevertheless, to any requirement of law that the disposition of the Holder's
property be at all times within its control. The Holder represents that it
understands that this Warrant has been issued in a transaction that is exempt
from the registration requirements of the Securities Act and that this Warrant
must be held by the Holder and may not be resold unless subsequently registered
under the Securities Act or an exemption from such registration is available.

SECTION 5.08: CURRENCY. All amounts used in this Agreement are expressed
in U.S. Dollars unless otherwise specified.

IN WITNESS WHEREOF, this Warrant has been duly executed by the Company
under its corporate seal as of the ______ day of ___________________, 1997.

VAALCO ENERGY, INC.


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By:_________________________________
Name:_______________________________
Title:______________________________

Attest:______________________________
Secretary

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ASSIGNMENT

(To be executed only upon assignment of Warrant Certificate)

For value received,_____________ hereby sells, assigns and transfers
unto _______________the within Warrant Certificate, together with all right,
title and interest therein, and does hereby irrevocably constitute and appoint
___________________________ attorney to transfer said Warrant Certificate on the
books of the within-named Company with respect to the number of Warrants set
forth below, with full power of substitution in the premises:

Name(s) of
ASSIGNEE(s) ADDRESS NO. OF WARRANTS

And if said number of Warrants shall not be all the Warrants represented by the
Warrant Certificate, a new Warrant Certificate is to be issued in the name of
said undersigned for the balance remaining of the Warrants registered by said
Warrant Certificate.

Dated:_________________________, 19

Note: The above signature should
correspond exactly with the name
on the face of this Warrant
Certificate

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SUBSCRIPTION FORM

(To be executed upon exercise of Warrant)

:

The undersigned hereby irrevocably elects to exercise the right of
purchaser represented by the within Warrant Certificate for, and to purchase
thereunder,____________________________ shares of Common Stock, as provided for
therein, and tenders herewith payment of the purchase price in full in the form
of cash or a certified or official bank check for the amount of
$________________________ .

Please issue a certificate or certificates for such Common Stock in the
name of, and pay any cash for any fractional share to:

Name

(Please print Name, Address and
Social Security No.)

Signature

Note: The above signature should correspond
exactly with the name on the first page of
this Warrant Certificate or with the name of
the assignee appearing in the assignment
form below.

And if said number of shares shall not be all the shares purchasable
under the within Warrant Certificate, a new Warrant Certificate is to be issued
in the name of said undersigned for the balance remaining of the shares
purchasable thereunder rounded up to the next higher number of shares.

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CASHLESS EXERCISE FORM

(To be executed upon exercise of Warrant pursuant to Section 2.02(a)(ii))

The undersigned hereby irrevocably elects to Exchange its Warrant for
such shares of Common Stock pursuant to the Cashless Exercise provisions of the
within Warrant Certificate, as provided for in Section 2.02(a)(ii) of such
Warrant Certificate.

Please issue a certificate or certificates for such Common Stock in the
name of:

Name

(Please print Name, Address and
Social Security No.)

Signature

NOTE: The above signature should correspond exactly with the name on the first
page of this Warrant Certificate or with the name of the assignee appearing in
the assignment form below.

And if said number of shares shall not be all the shares exchangeable or
purchasable under the within Warrant Certificate, a new Warrant Certificate is
to be issued in the name of the undersigned for the balance remaining of the
shares purchasable rounded up to the next higher number of shares.


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