Orca Exploration Announces Operational Update

TORTOLA, British Virgin Islands, Oct. 30, 2023 (GLOBE NEWSWIRE) -- Orca Energy Group Inc. (“Orca” or the “Company” and includes PanAfrican Energy Tanzania Limited (“PAET”) and its other subsidiaries, and affiliates) (TSX-V: ORC.A, ORC.B) today announces an operational update. All amounts are in United States dollars (“$”) unless otherwise stated.

OPERATIONAL

Production, Sales and Demand

• Gross conventional natural gas production, including fuel gas, was in line with forecasts and averaged 124.8 million cubic feet per day (“MMcfd”) for Q3 2023, of which 82.9 MMcfd was Additional Gas (“AG”). Gas deliveries decreased by 2% for Q3 2023 compared to Q2 2023 and increased by 4% for the nine months ended September 30, 2023 compared to the same prior year period. The decrease for Q3 2023 was primarily due to declining production from the currently producing wells and reservoir compartments in the Songo Songo field.
• Despite declining production, increased gas demand is now seen as part of a long term requirement of the Tanzanian Ministry of Energy, the Tanzania Petroleum Development Corporation (“TPDC”) and the Tanzanian Electric Supply Company Limited (“TANESCO”) for gas supply to support growing power demand, following the commissioning in late 2022 of new gas fired generation capacity and increased power distribution through the national grid. As a result of less consistent rainfall in Tanzania in recent years, resulting in lower average output of hydropower, this new gas fired capacity is being used on a more continuous base load basis than had been expected.
• Orca currently forecasts average AG gas sales for 2023 to be within the revised range of 85 – 90 MMcfd, compared to full year sales for 2022 sales of 86.8 MMcfd, due to declining production.
• Average production guidance (AG) for 2024 is forecast to be in the range of 80 – 90 MMcfd for the full year, based on current contracted volumes and the end of the Protected Gas (“PG”) regime on July 31, 2024.
• Discussions are ongoing with Songas Limited (“Songas”) and Tanzania Portland Cement Company Ltd (“TPCLC”) to negotiate new commercial terms under the gas agreement between the Company, Songas and TPCLC (the “Gas Agreement”) from August 1, 2024 to supply the volumes which are currently despatched as PG.

Field Development Activities