Orca Energy Group Announces Operational Update

TORTOLA, British Virgin Islands, Feb. 06, 2024 (GLOBE NEWSWIRE) -- Orca Energy Group Inc. ("we", "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.

Jay Lyons, Chief Executive Officer, commented:

"I am pleased to report that Orca achieved average natural gas production (for Additional Gas ("AG")) of 85.6 MMcfd during 2023, in line with its revised forecasts for the period, with total field production averaging 126.0 MMcfd for the year.

We are proactively managing daily production volumes so we can meet our contracted sales obligations through 2026. We are also actively seeking to engage with the Government of Tanzania to commence discussions on an extension to the Songo Songo development licence beyond October 2026. We have emphasized to the government that achieving a licence extension and US dollar availability are pre-requisites for making further investments into the field in order to underpin production.  This will ensure that low cost reliable gas continues to be produced for the benefit of all Tanzanian citizens for the foreseeable future.  We look forward to actively working with all of our partners in-country to deliver these commercial milestones in a timely manner.

As we approach the end of the Protected Gas era from August 2024, we forecast average gas production (for AG) to be in the range of 80 – 90 MMcfd for the full year and we look forward to providing further updates to our stakeholders over the coming months."

OPERATIONAL

Production, Sales and Demand

• Total gross conventional natural gas production, including fuel gas, was in line with revised forecasts and averaged 121.8 million cubic feet per day ("MMcfd") for Q4 2023, of which 80.8 MMcfd was AG. Gas sales decreased by 2.5% for Q4 2023 compared to Q3 2023 and decreased by 1.4% for the twelve months ended December 31, 2023 compared to the same prior year period.
• Average production guidance (AG) for 2024 is forecast to be in the range of 80 – 90 MMcfd (expected towards the lower end of the range) for the full year, based on current contracted volumes continuing 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 of the gas agreement (the "Gas Agreement") from August 1, 2024 to supply the volumes which are currently dispatched as PG, the obligation for which ends on 31^st July 2024.  
• Discussions are also ongoing with TANESCO to extend the Portfolio Gas Supply Agreement (the "PGSA") between the Company, the Tanzania Petroleum Development Corporation ("TPDC") and the Tanzanian Electric Supply Company ("TANESCO"), which currently ends on 31^st July 2024.

Field Development Activities