Income Taxes |
3 Months Ended |
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Mar. 31, 2016 | |
| Income Tax [Abstract] | |
| Income Taxes |
8. 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. As discussed further in the Notes to the consolidated financial statements in our Form 10-K for December 31, 2015, we have deferred tax assets related to foreign tax credits, alternative minimum tax credits, and domestic and foreign net operating losses (“NOLs”). 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, full valuation allowances have been recorded as of March 31, 2016. NOLs for our Gabon and Angola subsidiaries are included in the respective subsidiaries’ cost oil accounts which will be offset against future taxable revenues. In Angola, these NOLs are not available to offset financial gains which include foreign exchange gains and interest income. During the three months ended March 31, 2016, we recorded $3.0 million for income taxes in Angola on financial gains related to foreign exchange gains as well as the interest income paid by Sonangol P&P on their past due joint interest account balance. The remaining income taxes for the three months ended March 31, 2016 and all of the income taxes for March 31, 2015 are attributable to foreign taxes payable in Gabon.
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