Orca Exploration closes $60-million financing for natural gas field development offshore Tanzania

Offshore staff

TORTOLA, British Virgin Islands – Orca Exploration Group Inc. has entered into a loan agreement with International Finance Corporation (IFC), a member of the World Bank Group, for a $60-million investment in the company’s operating subsidiary, PanAfrican Energy Tanzania Ltd.

Proceeds of the loan will be used to fund part of an estimated $120-million first phase of a Songo Songo main field development. The program began in September and is currently being undertaken using the Paragon M826 drilling rig.

The offshore program is designed to restore and increase the current productive capacity of the Songo Songo main field to ensure the continued delivery of protected and additional gas into the existing Songas infrastructure. It should also provide additional operational redundancy and deliverability for future additional gas sales from three existing offshore wells, and/or the drilling of additional production gas wells.

Since the program began, previously suspended production wells SS-5 and SS-9 have been successfully worked over and recompleted, and have been restored to full productive capacity estimated to be approximately 35 MMcf/d per well.

The offshore program is intended to restore and expand field productive capacity from about 83 MMcf/d prior to the program to around 190 MMcf/d on completion of the program. When completed, the field is expected to be capable of both filling the existing Songas infrastructure to capacity of approximately 102 MMcf/d, as well as providing additional gas volumes to the newly commissioned National Natural Gas Infrastructure Project as and when contracted.

“It allows us to raise finance and manage risk in the face of a challenging business environment, and to undertake urgently needed development of the Songo Songo field. It further safeguards Songo Songo’s future as an important part of Tanzania’s energy security,” commented W. David Lyons, Orca chairman and CEO. “The World Bank was instrumental in bringing the Songo Songo gas-to-electricity project to reality some 20 years ago and Orca is pleased to continue this long-term relationship, now directly with IFC, in support of the sustainable development of Tanzania’s energy resources.”

10/30/2015

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