TSX-V: ORC.A, ORC.B
TORTOLA, British Virgin
Islands, June 15, 2015 /CNW/ -
Orca Exploration Group Inc. ("Orca" or the "Company") announces
that it is proceeding with the first phase of the Songo Songo
development programme following World Bank board approval of the
International Finance Corporation ("IFC") financing.
IFC has received approval by the board of World Bank for an
investment by IFC of up to US$60
million in the Company's operating subsidiary, PanAfrican
Energy Tanzania Limited. The investment is currently contemplated
as a subordinated, income participating loan with flexible
repayment terms and a maximum tenor of approximately 10 years.
Completion of the IFC financing is subject to final agreement of
specific terms and the negotiation and signing of definitive
documentation. Initial drawdown of the facility will be subject to
a number of terms and conditions, including satisfaction by IFC of
the sustained payment performance of the Tanzania state utility, TANESCO, in respect of
ongoing gas deliveries by the Company.
Subsequent to the approval of the IFC financing, the Company
entered into a drilling contract with Paragon Offshore plc for the
use of its M826 Mobile Drilling Workover Rig, as well the provision
of associated services, in order to execute the offshore phase of
the development programme for the Songo Songo gas field. The
Paragon M826 Mobile Drilling Workover Rig was selected to operate
in the somewhat unique shallow water operating environment around
Songo Songo Island. The
Company still needs to obtain certain regulatory and contractual
approvals related to certain aspects of the development
programme.
The drilling contract provides for a commencement date between
1st August 2015 and
21st September 2015, with
the exact date being the date the drilling rig arrives at the
Company's first well location in Songo Songo. The contract
carries a minimum duration of 90 days and a minimum financial
commitment of US$21 million excluding
withholding tax. The Company's commitments under the drilling
contract are not subject to completion of the IFC financing or
funding of such financing.
The Company currently anticipates operations commencing by
September 2015. The operations are
planned to include workovers (being the removal and replacement of
production tubing strings) on three existing wells (SS‑5, SS-7 and
SS-9) and the drilling of one new well (SS-J). The Company
also retains the option to drill a further two wells, subject to
the success of the workovers.
Orca Exploration Group Inc.
Orca is an international public company engaged in natural gas
exploration, development and supply in Tanzania through the wholly-owned subsidiary
PanAfrican Energy Tanzania Limited ("PanAfrican Energy"), as well
as oil and gas appraisal in Italy.
Orca trades on the TSX Venture Exchange under the trading symbols
ORC.A and ORC.B.
Neither the TSX Venture Exchange nor its Regulation Service
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Forward Looking Information
This news release contains forward-looking information. More
particularly, this news release contains statements and information
concerning, but not limited to, the Company's expectation that the
IFC financing will be in the form of a subordinated, income
participating loan with flexible repayment terms and a maximum
tenor of approximately 10 years and that the Company and the IFC
will come to a final agreement on other specific terms as well as
agree on definitive documentation, and the Company's anticipation
that it will obtain the necessary regulatory and contractual
approvals related to certain aspects of the development programme
and commence operations pursuant to the drilling contract by
September 2015 that include workovers
on three existing wells and the drilling of one new well.
Although management believes that the expectations reflected in the
forward-looking information are reasonable, it cannot guarantee
future agreement, levels of activity, performance or achievements
since such expectations are inherently subject to significant
uncertainties and contingencies. As a consequence, actual results
may differ materially from those anticipated in the forward-looking
information.
Forward-looking information involves substantial known and
unknown risks and uncertainties, certain of which are beyond Orca's
control, and many factors could cause the actual results to differ
materially from those expressed or implied in the forward-looking
information presented by Orca, including, but not limited to: the
failure to successfully negotiate definitive documentation with the
IFC; risk that Paragon Offshore plc fails to fulfill the terms in
the drilling contract; the impact of general economic conditions in
the areas in which Orca operates; changes in laws and regulations
including changes in how they are interpreted and enforced; the
lack of availability of qualified personnel or management;
obtaining certain required contractual approvals and approvals of
certain regulatory authorities; risks associated with negotiating
with foreign governments; inability to access sufficient capital;
and risk that the Company will not be able to fulfill its
obligations. Actual results, performance or achievements
could differ materially from those expressed in, or implied by, the
forward-looking information and, accordingly, no assurances can be
given that any of the events anticipated by the forward-looking
information will transpire or occur, or if any of them do so, what
benefits Orca will derive therefrom. Readers are cautioned that the
foregoing list of factors is not exhaustive.
Such forward-looking information is based on certain
assumptions made by Orca in light of its experience and current
knowledge of the circumstances, as well as other factors Orca
believes are appropriate in the circumstances, including, but not
limited to: that the Company and the IFC will come to a final
agreement on specific terms and successfully negotiate definitive
documentation; that the Company will obtain necessary regulatory
and contractual approvals related to certain aspects of the
development programme; that the Company will have sufficient cash
flow, debt or equity sources or other financial resources required
to fund its operations; and other matters.
The forward-looking information contained in this news
release is made as of the date hereof and Orca undertakes no
obligation to update publicly or revise forward-looking
information, whether as a result of new information, future events
or otherwise, unless so required by applicable securities
laws.
SOURCE Orca Exploration Group Inc.