Orca Energy Group Inc. Announces Completion of its Q1 2021 Interim Filings

TORTOLA, BRITISH VIRGIN ISLANDS – May 18, 2021: Orca Energy Group Inc. (“Orca” or the “Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) today announces that it has filed its condensed consolidated interim financial statements and management’s discussion and analysis for the three month period ended March 31, 2021 (“Q1 2021“) with the Canadian securities regulatory authorities. All amounts are in United States dollars (“$”) unless otherwise stated.

  • Revenue increased 5% for Q1 2021 to $18.6 million compared to the same prior year period. The increase was primarily a result of increased sales to industrial customers. Gas deliveries for the quarter increased by 4% compared to the same prior year period. The increase in gross sales volume was primarily due to the increase in gas deliveries to industrial customers as a result of expansion of the Company’s customer base.
  • Net income attributable to shareholders decreased 69% for Q1 2021 to $4.0 million compared to the same prior year period, primarily a result of the decrease in the reversal of loss allowances related to the lower collection of arrears from Tanzanian Electric Supply Company Limited (“TANESCO”) compared to Q1 2020.
  • Net cash flows used in operating activities for Q1 2021 were $0.8 million compared to net cash flows from operating activities of $0.8 million in Q1 2020, a decrease of $1.6 million. The decrease was primarily a result of the lower collection of TANESCO arrears being offset by an increase in trade and other receivables from Q4 2019 to Q1 2020.
  • Adjusted funds flow from operations for Q1 2021 increased by 13% to $8.6 million compared to the same prior year period, primarily a result of the increase in revenue.
  • Capital expenditures decreased by 53% for Q1 2021 to $0.2 million compared to the same prior year period. The capital expenditures in Q1 2021 were primarily for well workover planning and design.  The capital expenditures in Q1 2020 primarily relate to the flowline decoupling construction. The Company is currently installing compression to allow production volumes to be sustained at approximately 102 million standard cubic feet per day (“MMcfd”) through the Songas infrastructure. This provides the possibility to expand production capabilities to 172 MMcfd by also utilizing the National Natural Gas Infrastructure (“NNGI”). The value of the contract for compression is $38 million of which $24.7 million was incurred prior to 2021 with forecasted expenditures of $9.5 million for 2021, upon delivery and inspection of the equipment, and $3.8 million for 2022 following installation and testing. The project is currently on budget and on schedule for completion in Q2 2022. 
  • The Company exited the period in a strong financial position with $47.4 million in working capital (December 31, 2020: $74.2 million), cash and cash equivalents of $68.0 million (December 31, 2020: $104.2 million) and long-term debt of $54.2 million (December 31, 2020: $54.2 million). The decrease in working capital and cash and cash equivalents was primarily related to the substantial issuer bid completed in January 2021 (“2021 SIB”).
  • As at March 31, 2021 the current receivable from TANESCO was $ nil (December 31, 2020: $ nil). TANESCO’s long-term trade receivable as at March 31, 2021 was $26.8 million with a provision of $26.8 million compared to $27.6 million (provision of $27.6 million) as at December 31, 2020. Subsequent to March 31, 2021 the Company invoiced TANESCO $0.4 million for April 2021 gas deliveries and TANESCO paid the Company $2.6 million for Q2 2021 gas deliveries and $5.0 million for the take or pay invoice for the 2015-2016 contract year. In accordance with the Portfolio Gas Sales Agreement, the take or pay gas for the 2015-2016 contract year was to be taken by June 30, 2021, however the Company has agreed with TANESCO to extend the time period to take the gas until June 30, 2022.
  • On February 23, 2021 the Company declared a dividend of CDN$0.10 per share on each of its Class A common voting shares (“Class A Shares”) and Class B subordinate voting shares (“Class B Shares”) for a total of $1.6 million to the holders of record as of March 31, 2021 which was paid on April 15, 2021.
  • On January 22, 2021 the Company announced the final results of the 2021 SIB whereby the Company repurchased and cancelled 6,153,846 Class B Shares at a price of CDN$6.50 per Class B Share representing an aggregate purchase price of CDN$40.0 million and 25.2% of the total number of the Company’s issued and outstanding Class B Shares and 23.5% of the total number of the Company’s issued and outstanding shares.

Jay Lyons, Interim Chief Executive Officer, commented:

“We are pleased to report a solid set of Q1 results, which include an increase in revenue reflecting our growing customer base and continuing role in helping to meet Tanzania’s growing power needs.  Operationally, we remain on track and within budget with the installation of compression equipment, designed to ensure the Company can maintain production volumes at 102 MMcfd, with the potential to increase by a further 70 MMcfd.  With a tight control on costs, we maintain a strong balance sheet, enabling us to not only continue investing in the creation of value from the world class Songo Songo gas field, but also making appropriate returns to our shareholders.  We look forward to continuing to keep our stakeholders appraised of our progress as we move forward.”

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Orca Energy Group Inc. Announces 2020 Year End Audited Financial Results

VIRGIN ISLANDS – April 21, 2020: Orca Energy Group Inc. (“Orca” or the “Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) today announces its audited financial results for the year ended December 31, 2020. All dollar amounts are in United States dollars unless otherwise stated.

  • Revenue decreased by 5% for Q4 2020 and by 9% for the year compared to the same prior year periods. The decreases are primarily a result of decreased sales to the Tanzanian Electric Supply Company Limited (“TANESCO”) under the Portfolio Gas Sales Agreement (“PGSA”) and a smaller current income tax adjustment due to increased capital expenditure and lower gross field revenue. Gas deliveries decreased by 11% for Q4 2020 and by 9% for the year compared to the same prior year periods. The decrease in revenue and gas delivery volumes for the year were primarily due to the increase in hydropower generated during the first eight months of the year as a result of higher than normal rainfall in 2020 compared to the prior year. The decrease in gas delivery volumes in Q4 2020 is primarily the result of lower nominations of gas volumes by TANESCO and the Tanzanian Production Development Corporation (“TPDC”) through the National Natural Gas Infrastructure (“NNGI”) compared to Q4 2019 as volumes delivered in Q4 2019 were the highest for any single quarter since production started in 2004. The decrease in volumes for Q4 2020 was partially offset by a 2% increase in the weighted average price of gas sold compared to Q4 2019.
  • Net income attributable to shareholders decreased 42% for Q4 2020 and increased by 12% for the year compared to the same prior year periods. The decrease for Q4 2020 was primarily a consequence of the decrease in revenue and a decrease in the reversal of loss allowances related to the lower collection of arrears from TANESCO compared to Q4 2019. The increase in net income attributable to shareholders for the year was primarily the result of the increase in the reversal of loss allowances of $8.2 million, mainly due to increased collection of TANESCO arrears during the first nine months of 2020 and was also positively impacted by savings in general and administrative expenses and stock based compensation. The increase for the year was partially offset by the impairment of receivable as a result of the Tanzania Revenue Authority (“TRA”) issuing an Agency Notice during the year obligating the Company’s bank to release $5.3 million in favour of the TRA.
  • Net cash flows from operating activities increased 283% for Q4 2020 and by 33% for the year compared to the same prior year periods. The increases are primarily a result of the collection of TANESCO arrears and changes in non-cash operating working capital associated with decreases in prepayments and in trade and other receivables.
  • Adjusted funds flow from operations(1) decreased by 8% for Q4 2020 and by 9% for the year compared to the same prior year periods. The decreases are primarily a result of the decreases in revenue.
  • Capital expenditures increased by 1,509% for Q4 2020 and by 551% for the year over the comparable prior year periods. The capital expenditures in 2020 primarily relate to the flowline decoupling construction and payments under the Compression Contract (as defined below). The capital expenditures in 2019 primarily relate to the refrigeration project for the Songas Limited (“Songas”) infrastructure.
  • The Company exited the period in a strong financial position with $74.2 million in working capital (December 31, 2019: $107.0 million), cash and cash equivalents of $104.2 million (December 31, 2019: $93.9 million), short-term investments of $ nil (December 31, 2019: $44.8 million) and long-term debt of $54.2 million (December 31, 2019: $54.1 million). The decrease in working capital and short-term investments was primarily related to the substantial issuer bid (“SIB”) completed in March 2020.
  • As at December 31, 2020 the current receivable from TANESCO was $ nil (December 31, 2019: $ nil). TANESCO’s long-term trade receivable as at December 31, 2020 was $27.6 million with a provision of $27.6 million compared to $47.5 million (provision of $47.5 million) as at December 31, 2019. Subsequent to December 31, 2020 the Company has invoiced TANESCO $6.5 million for 2021 gas deliveries and TANESCO has paid the Company $7.9 million. TANESCO also paid the take or pay invoice of $5.0 million for the 2015-2016 contract year for gas to be taken by June 30, 2021.
  • Work began in 2020 on the $38.0 million compression contract for the Songas gas processing facility planned for installation in Q2 2022 (the “Compression Contract“). This will allow maximum production volumes of approximately 102 MMcfd to be sustained through the Songas infrastructure, with the possibility to expand well deliverability to 172 MMcfd by increasing the amount of gas currently being delivered through the NNGI. To date $24.7 million has been spent under the contract with forecast expenditures of $9.5 million in 2021, upon delivery and inspection of the equipment, and a further $3.8 million in 2022 following completion of installation and testing.
  • On January 22, 2021 the Company announced the final results of an SIB initiated in December 2020 whereby the Company repurchased and cancelled 6,153,846 Class B Subordinate Voting Shares (“Class B Shares”) at a price of CDN$6.50 per Class B Share representing an aggregate purchase price of CDN$40.0 million and 25.2% of the total number of the Company’s issued and outstanding Class B Shares and 23.5% of the total number of the Company’s issued and outstanding shares.
  • On February 23, 2021 the Company declared a dividend of CDN$0.10 per share on each of its Class A Common Voting Shares (“Class A Shares”) and Class B Shares for a total of $1.6 million to the holders of record as of March 31, 2021 paid on April 15, 2021.

(1) Adjusted funds flow from operations is a non-GAAP financial measure. See non-GAAP measures.

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Orca Energy Group Inc. Announces Independent Reserves Evaluation for Year End 2020

TORTOLA, BRITISH VIRGIN ISLANDS – March 2, 2021 – Orca Energy Group Inc. (“Orca” or the “Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) announces the approval of its Independent Reserves Evaluation as at December 31, 2020. All currency amounts in this news release are in United States Dollars ($) unless otherwise stated.

INDEPENDENT RESERVES EVALUATION

The Company’s conventional natural gas reserves as at December 31, 2020 for the period to the end of the primary (25 year) term of the production sharing agreement (the “Songo Songo PSA“) with the Tanzanian Petroleum Development Corporation (the “TPDC“) have been evaluated by independent petroleum engineering consultants McDaniel & Associates Consultants Ltd. (“McDaniel“) in accordance with the definitions, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook (“COGE Handbook“) and National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (“NI 51-101“). The Songo Songo PSA expires upon the expiry of TPDC’s Songo Songo licence in respect of the Songo Songo Block (the “Songo Songo Licence“) in October 2026. The preparation date of the independent reserves evaluation prepared by McDaniel (the “McDaniel Report“) is February 23, 2021 and the effective date of the evaluation is December 31, 2020.

All the Company’s reserves are located in Tanzania. Reserves included herein are stated on a Company gross reserves basis unless noted otherwise. Company gross reserves are the total of the Company’s working interest share in reserves before deduction of royalties owned by others and without including any royalty interests of the Company, and are based on the Company’s 92.07 percent ownership interest in the reserves following the transaction with Swala Oil & Gas (Tanzania) plc (“Swala“) described in Note 3 to the tables below.

The Company’s Board of Directors has reviewed and approved the year ended December 31, 2020 McDaniel Report. Additional reserves information required under NI 51-101 is included in Orca’s reports relating to reserves data and other oil and gas information under NI 51-101, which [are/will be] filed on its profile on SEDAR at www.sedar.com. The following discussion is subject to a number of cautionary statements, assumptions, contingencies and risks as set forth in this news release.

HIGHLIGHTS

  • Total Proved (“1P”) Gross Company conventional natural gas reserves at year ended December 31, 2020, were 203 billion standard cubic feet (“Bcf”). After adjustment for the Company’s share of gas produced in 2020, this represents a 5%, or 12 Bcf decrease from the year end 2019.
  • Total Proved plus Probable (“2P”) Gross Company conventional natural gas reserves at year ended December 31, 2020, were 229 Bcf. After adjustment for the Company’s share of gas produced in 2020, this represents a 6%, or 16 Bcf decrease from the year end 2019.
  • Net Present Value of 1P estimated future cash flows discounted at 10% were $216.4 million at year end 2020, compared to $237.1 million at year end 2019, representing a 9% decrease.
  • Net Present Value of 2P estimated future cash flows discounted at 10% were $241.3 million at year end 2020, compared to $282.6 million at year end 2019, representing a 15% decrease.
  • The reduction in Gross Company 1P reserves from year end 2019 to year end 2020 are primarily attributed to forecasted Company gas sales of approximately 27 Bcf for the year 2020, of which approximately 19 Bcf were produced and sold. Actual sales of Additional Gas were lower than forecast in 2020 due to reduced power and industrial gas demand in Tanzania attributable to abnormally high rain fall leading to increased hydro power in Tanzania and the worldwide pandemic which impacted global supply chains and associated industrial gas demand in Tanzania.
  • Company gas sales are forecasted to average approximately 65.3 MMcfd (~23.8 Bcf) in 2021 (1P case) assuming normal hydro power generation, recovering industrial demand and prospective customer confidence.
  • The reduction in future net present values were primarily attributed to lower reserves at year end 2020 associated with the reduced number of years remaining on the primary license (5.8 years at YE 2020 versus 6.8 years at YE 2019, or a 15% reduction in producing days to end of license).

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Orca Announces Increased Quarterly Dividend

TORTOLA, British Virgin Islands – February 23, 2021:  Orca Energy Group Inc. (“Orca” or the “Company”) (TSX-V: ORC.A, ORC.B) today announced that its Board of Directors has declared that the quarterly cash dividend has been increased from $.08 to $0.10 (Cdn) per Class A Common Voting Share (“Class A Shares”) of the Company and from $.08 to $0.10 (Cdn) per Class B Subordinate Voting Share (“Class B Shares“) of the Company. The dividend will be payable on April 15, 2021 to holders of Class A Shares and Class B Shares of record on March 31, 2021.

Jay Lyons, Interim Chief Executive Officer, commented:

The 25% increase in our quarterly dividend reflects the successful outcome of the share buyback in January 2021, where Orca was able to repurchase 25.2 % of the outstanding Class B Shares of the Company. With the dividend increase, the total amount approved for dividend distribution remains in line with the amount approved by the Board of Directors for distribution in 2021.  The dividend increase reaffirms our ongoing strategy of returning capital to shareholders through quarterly dividends and share buy backs.

About Orca Energy Group Inc.

Orca is an international public company engaged in natural gas exploration, development and supply in Tanzania through its subsidiary PanAfrican Energy Tanzania Limited. Orca trades on the TSX Venture Exchange under the trading symbols ORC.A and ORC.B.

For further information please contact:

Jay Lyons
jlyons@orcaenergygroup.com

Blaine Karst
bkarst@orcaenergygroup.com

For media enquiries:
Celicourt (PR)
Mark Antelme
Jimmy Lea
Orca@celicourt.uk

+44-20 8434 2643

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.

Orca Energy Group Inc. Announces Completion of Substantial Issuer Bid

TORTOLA, BRITISH VIRGIN ISLANDS – January 26, 2021 – Orca Energy Group Inc. (“Orca” or the “Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) today is announcing that it has taken up 6,153,846 Class B Subordinate Voting Shares (“Class B Shares“) at a price of CDN$6.50 per Class B Share under Orca’s substantial issuer bid to purchase for cancellation a number of its Class B Shares for an aggregate purchase price not to exceed CDN$40 million (the “Offer“) and paid to AST Trust Company (Canada) (the “Depositary“) the purchase price proceeds. All dollar amounts are in Canadian dollars.

The Class B Shares purchased represent an aggregate purchase price of approximately CDN$40 million and represent 25.2% of the total number of Orca’s issued and outstanding Class B Shares and 23.5% of the total number of Orca’s issued and outstanding shares. After giving effect to the Offer, Orca has 18,233,614 Class B Shares issued and outstanding and 1,750,495 Class A Common Shares issued and outstanding.

Since the Offer was oversubscribed, shareholders who successfully tendered shares to the Offer pursuant to auction and purchase price tenders at the purchase price had approximately 32.2% of their successfully tendered shares purchased by Orca (other than “odd lot” tenders, which were not subject to proration).

Any shares not purchased, including such shares not purchased as a result of proration or shares tendered pursuant to auction tenders at prices higher than the purchase price or invalidly tendered, will be returned to shareholders as soon as practicable by the Depositary.

Payment to shareholders for their purchased Class B Shares by the Depositary is expected to occur on or about January 29, 2021 in accordance with the Offer and applicable law.

The full details of the Offer are described in the offer to purchase and issuer bid circular dated December 14, 2020, as well as the related letter of transmittal and notice of guaranteed delivery, copies of which were filed and are available on Orca’s SEDAR profile at www.sedar.com.

This press release is for information purposes only and does not constitute an offer to buy or the solicitation of an offer to sell Orca’s shares.  

Orca Energy Group Inc.

Orca is an international public company engaged in natural gas development and supply in Tanzania through its subsidiary PanAfrican Energy Tanzania Limited. Orca trades on the TSX Venture Exchange under the trading symbols ORC.A and ORC.B.

For further information please contact:

Jay Lyons, Interim CEO
jlyons@orcaenergygroup.com
+44-7798-502316

Blaine Karst, CFO
bkarst@orcaenergygroup.com
+44-7471-902734

For media enquiries:
Celicourt (PR)
Mark Antelme
Jimmy Lea
Orca@celicourt.uk
+44-20 8434 2643

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

Certain information regarding Orca set forth in this news release, including but not limited to: when shareholders will receive from the Depositary the shares not purchased under the Offer and when shareholders will receive from the Depositary payment for their purchased shares constitute “forward-looking information” within the meaning of applicable Canadian securities laws. The words “may”, “will”, “would”, “should”, “could”, “expects”, “plans”, “intends”, “trends”, “indications”, “anticipates”, “believes”, “estimates”, “predicts”, “likely” or “potential” or the negative or other variations of these words or other comparable words or phrases, are intended to identify forward-looking information. Forward-looking information, by its very nature, involves inherent risks and uncertainties and is based on several assumptions, both general and specific. Orca cautions that its assumptions may not materialize and that current economic conditions render such assumptions, although believed reasonable at the time they were made, subject to greater uncertainty. Such forward-looking information is not a guarantee of future performance and involves known and unknown risks, uncertainties and other factors which may cause the actual results or performance of Orca to be materially different from the outlook or any future results or performance implied by such information.

The forward-looking information contained in this new release is provided as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless so required by applicable Canadian securities laws.

Orca Energy Group Inc. Announces Final Results of Substantial Issuer Bid

TORTOLA, BRITISH VIRGIN ISLANDS – January 21, 2021 – Orca Energy Group Inc. (“Orca” or the “Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) today is announcing the final results of its substantial issuer bid commenced on December 16, 2020, pursuant to which the Company offered to purchase for cancellation a number of its Class B Subordinate Voting Shares (“Class B Shares“) for an aggregate purchase price not to exceed CDN$40 million at a purchase price of not less than CDN$6.50 and not more than CDN$7.50 per Class B Share (the “Offer“). The Offer expired at 5:00 p.m. (Toronto time) on Wednesday January 20, 2021. All dollar amounts are in Canadian dollars.

In accordance with the terms and conditions of the Offer, and based on the final information from AST Trust Company (Canada), as depositary for the Offer (the “Depositary“), Orca will take up and pay for 6,153,846 Class B Shares at a price of CDN$6.50 per Class B Share, representing an aggregate purchase price of approximately CDN$40.0 million and 25.2% of the total number of Orca’s issued and outstanding Class B Shares and 23.5% of the total number of Orca’s issued and outstanding shares.

An aggregate of 19,024,697 Class B Shares were validly tendered and not withdrawn pursuant to auction and purchase price tenders at the purchase price. Since the Offer was oversubscribed, shareholders who successfully tendered shares to the Offer will have the number of shares purchased by Orca prorated to approximately 32.2% of their successfully tendered shares (other than “odd lot” tenders, which are not subject to proration).

Payment and settlement of the purchased Class B Shares will be effected by the Depositary on or about January 25, 2021 in accordance with the Offer and applicable law.

After giving effect to the Offer, Orca will have 18,233,614 Class B Shares and 1,750,495 Class A Shares issued and outstanding.

The full details of the Offer are described in the offer to purchase and issuer bid circular dated December 14, 2020 as well as the related letter of transmittal and notice of guaranteed delivery, copies of which were filed and are available on Orca’s SEDAR profile at www.sedar.com.

This press release is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell Orca’s shares.  

Orca Energy Group Inc.

Orca is an international public company engaged in natural gas development and supply in Tanzania through its subsidiary PanAfrican Energy Tanzania Limited. Orca trades on the TSX Venture Exchange under the trading symbols ORC.A and ORC.B.

For further information please contact:

Jay Lyons, Interim CEO
jlyons@orcaenergygroup.com
+44-7798-502316

Blaine Karst, CFO
bkarst@orcaenergygroup.com
+44-7471-902734

For media enquiries:
Celicourt (PR)
Mark Antelme
Jimmy Lea
Orca@celicourt.uk
+44-20 8434 2643

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

Certain information regarding Orca set forth in this news release, including but not limited to: when shareholders will receive from the Depositary the shares not purchased under the Offer and the timing for payment and settlement of the Class B Shares purchased for cancellation under the Offer, constitute “forward-looking information” within the meaning of applicable Canadian securities laws. The words “may”, “will”, “would”, “should”, “could”, “expects”, “plans”, “intends”, “trends”, “indications”, “anticipates”, “believes”, “estimates”, “predicts”, “likely” or “potential” or the negative or other variations of these words or other comparable words or phrases, are intended to identify forward-looking information. Forward-looking information, by its very nature, involves inherent risks and uncertainties and is based on several assumptions, both general and specific. Orca cautions that its assumptions may not materialize and that current economic conditions render such assumptions, although believed reasonable at the time they were made, subject to greater uncertainty. Such forward-looking information is not a guarantee of future performance and involves known and unknown risks, uncertainties and other factors which may cause the actual results or performance of Orca to be materially different from the outlook or any future results or performance implied by such information.

The forward-looking information contained in this new release is provided as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless so required by applicable Canadian securities laws.

ORCA Energy Group inc. Announces Preliminary Financial and Operating Results for 2020

TORTOLA, BRITISH VIRGIN ISLANDS – January 8, 2021 – Orca Energy Group Inc. (“Orca” or the “Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) announces its preliminary unaudited financial and operating results for 2020. All currency amounts in this news release are in United States Dollars ($) unless otherwise stated.

FINANCIAL HIGHLIGHTS

For the year ended December 31, 2020, the Company’s:

  • Average sales volumes for the year ended December 31, 2020 decreased 8.6% to 57.7 million standard cubic feet per day (“MMcfd”) compared to 63.1 MMcfd for the year ended December 31, 2019 and for Q4 2020 decreased 11.3% to 62.8 MMcfd compared to 70.8 MMcfd for Q4 2019. Reduced gas sales in 2020 were primarily attributed to the impact of the coronavirus pandemic on consumer investment/demand and abnormally high rainfall in early 2020 which reduced gas fired power demand due to increased hydro power generation.
  • Revenue decreased 10.4% to $76.7 million compared to $85.6 million in the year ended December 31, 2019 and for Q4 2020 decreased 10.3% to $20.8 million compared to $23.2 million in Q4 2019.
  • Cash and short-term investments totaled $103.8 million on December 31, 2020 compared to $138.7 million at December 31, 2019. The decrease is primarily due to the substantial issuer bid of CDN$50 million completed in Q1 2020. 
  • As at December 31, 2020 the current receivable from Tanzanian Electricity Supply Company (“TANESCO”) was $ nil (December 31, 2019: $ nil). The TANESCO long-term trade receivable as at December 31, 2020 was $27.6 million with a provision of $27.6 million compared to $47.5 million (provision of $47.5 million) as at December 31, 2019. 
  • Capital expenditures for the year ended December 31, 2020 were $27.0 million, which included an advance payment of $11.4 million for the procurement of long lead items of the compression project, compared to $5.8 million for the year ended December 31, 2019. The total value for the contract for the compression project signed in August 2020 is $38.0 million of which $24.7 million has been incurred to date. The expenditures in 2019 were primarily related to the refrigeration project for the Songas gas processing plant.

The financial highlights noted above relating to production volumes, revenue, cash and short-term investments, TANESCO receivables and capital expenditures are management estimates only, have been reviewed by our Audit Committee, are unaudited, and have not been reviewed or audited by our auditors or approved by our Board of Directors. These estimates are subject to a number of cautionary statements, assumptions, contingencies and risks as set forth in this news release. In addition, see “Forward-looking Information” for a statement of principal assumptions and risks that may apply. As such, these estimates may change upon the completion of the audited financial statements for the year ended December 31, 2020. Such changes could be material.

Jay Lyons, Interim Chief Executive Officer, commented: 

Considering the difficult operational context deriving from the global impact of the corona virus pandemic and its knock-on implications on the domestic operating environment, I am pleased with the performance of our Company during 2020.  We continue to progress our strategy to focus on the Tanzanian gas business while providing return of capital to our shareholders through quarterly dividends and share buy backs. We maintain focus on the compression project for the Songas gas processing plant as evidenced by the level of capital incurred on this project in 2020. The project remains on budget and on track for completion in 2022 and we look forward to keeping the market updated on our wider progress over the coming months.

Orca Energy Group Inc.

Orca is an international public company engaged in natural gas development and supply in Tanzania through its subsidiary PanAfrican Energy Tanzania Limited. Orca trades on the TSX Venture Exchange under the trading symbols ORC.A and ORC.B.

For further information please contact: 

Jay Lyons, Interim CEO
jlyons@orcaenergygroup.com
+44-7798-502316

Blaine Karst, CFO
bkarst@orcaenergygroup.com
+44-7471-902734

For media enquiries:
Celicourt (PR)
Mark Antelme
Jimmy Lea
Jemima Lowe
Orca@celicourt.uk
+44-20 8434 2643

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

Certain information regarding Orca set forth in this news release contains forward-looking information and statements as defined under applicable securities laws (the “forward-looking statements” or “statements“) that involve substantial known and unknown risks and uncertainties.  The use of any of the words “plan”, “expect”, “prospective”, “project”, “intend”, “believe”, “should”, “anticipate”, “estimate” or other similar words, or statements that certain events or conditions “may” or “will” occur are intended to identify forward-looking statements. This press release contains, without limitation, forward-looking statements pertaining to the following: expected timing for completion of the compression project for the Songas gas processing plant; the Company’s ability to continue progressing the compression project for the Songas gas processing plant; the Company’s strategy of focusing on the Tanzanian gas business; and the Company’s ability to return capital to shareholders. These statements are only predictions and actual events or results may differ materially. Although the Companys management believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause Orca’s actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Orca. 

These forward-looking statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company’s control, and many factors could cause the Company’s actual results to differ materially from those expressed or implied in any forward-looking statements made by the Company, including, but not limited to, Orca’s dependency on its management and technical team; reduced global activity as a result of the COVID-19 pandemic, including lower demand for natural gas and a reduction in price of natural gas, the potential impact of the COVID-19 pandemic on the health of the Company’s employees, contractors, suppliers, customers and other partners and the risk that the Company and/or such persons are or may be restricted or prevented (as a result of quarantines, closures or otherwise) from conducting business activities for undetermined periods of time; the impact of actions taken by governments to reduce the spread of COVID-19, including declaring states of emergency, imposing quarantines, border closures, temporary business closures for companies and industries deemed non-essential, significant travel restrictions and mandated social distancing, and their effect on the Company’s operations, access to customers and suppliers, availability of employees and other resources; risk that contract counterparties are unable to perform contractual obligations; the impact of general economic conditions in the areas in which the Company operates, civil unrest; the susceptibility of the areas in which the Company operates to outbreaks of disease; industry conditions; lack of availability of qualified personnel or management; fluctuations in commodity prices, foreign exchange rates and/or interest rates; stock market volatility; competition for, among other things, capital, drilling equipment and skilled personnel; failure to obtain required equipment for drilling; delays in drilling plans; failure to obtain expected results from drilling of wells; changes in laws and how they are interpreted and enforced; obtaining required approvals from regulatory authorities; risks associated with negotiating with foreign governments; and unanticipated changes in legislation and the effect on the Company’s operations. In addition, there are risks and uncertainties associated with oil and gas operations. Therefore, the Company’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements, and accordingly, no assurances can be given that any of the events anticipated by these forward-looking statements will transpire or occur, or if any of them do so, what benefits the Company will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive.  Management has included the above summary of assumptions and risks related to forward-looking information provided in this news release in order to provide investors with a more complete perspective on Orca’s current and future operations and such information may not be appropriate for other purposes. Orca’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what benefits Orca will derive. These forward-looking statements are made as of the date of this news release and Orca disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement. 

Orca Energy Group Inc. Announces Commencement of Substantial Issuer Bid up to C$40 Million

TORTOLA, BRITISH VIRGIN ISLANDS – December 14, 2020 – Orca Energy Group Inc. (“Orca” or the “Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) is commencing its previously announced substantial issuer bid on December 16, 2020 pursuant to which the Company will offer to purchase for cancellation up to C$40million of its Class B Subordinate Voting Shares (“Class B Shares“) for cash (the “Offer“). The Offer will expire at 5:00 p.m. (Toronto time) on January 20, 2021, unless extended, varied or withdrawn by Orca. All dollar amounts are in Canadian dollars.

The Offer is being made by way of a “modified Dutch auction”, allowing shareholders of the Company (“Shareholders“) who choose to participate in the Offer to individually select the price, within a price range of not less than C$6.50 and not more than C$7.50 per Class B Share (in increments of C$0.05per Class B Share), at which they will tender their Class B Shares to the Offer. Upon expiry of the Offer, Orca will determine the lowest purchase price (which will not be more than C$7.50 and not less than C$6.50 per Class B Share) that will allow it to purchase the maximum number of Class B Shares properly tendered to the Offer, and not properly withdrawn, having an aggregate purchase price not exceeding C$40million.

Holders of Class B Shares and Class A Common Shares (“Class A Shares” and together with the Class B Shares, “Shares“) of the Company who wish to participate in the Offer will be able to do so through: (i) an auction tender in which they will specify the number of Shares being tendered at a price of not less than C$6.50 and not more than C$7.50 per Class B Share in increments of C$0.05per Class B Share; or (ii) a purchase price tender in which they will agree to have a specified number of Shares purchased at the purchase price to be determined pursuant to the auction (the “Purchase Price“) and have their Shares considered as having been tendered at the minimum price of C$6.50 for the purposes of determining the Purchase Price. Shareholders who validly deposit Shares without specifying the method in which they are tendering their Shares will be deemed to have made a purchase price tender, understanding that those Shares will be considered to have been tendered at the minimum price of C$6.50 per Class B Share. All Shares tendered at or below the finally determined Purchase Price will be purchased, subject to proration and “odd lot” priority, at the same Purchase Price determined pursuant to the terms of the Offer. Shares that are not purchased, including Shares tendered pursuant to auction tenders at prices above the Purchase Price, will be returned to Shareholders.

Holders of Class A Shares will be entitled to participate in the Offer. Class A Shares taken up by Orca will be converted into Class B Shares on a one-for-one basis immediately prior to take up. Only those Class A Shares proposed to be taken up by Orca will be converted into Class B Shares on a one-for-one basis immediately prior to take up.

The Offer is not conditional upon any minimum number of Class B Shares being tendered to the Offer, but is subject to other conditions and Orca reserves the right, subject to applicable laws, to withdraw or amend the Offer, if, at any time prior to the payment of deposited Class B Shares, certain events occur. Orca intends to fund any purchases of Shares pursuant to the Offer from cash on hand.

As of today, Orca has 24,387,460 Class B Shares and 1,750,495 Class A Shares issued and outstanding. Shaymar Limited (“Shaymar“) holds 1,741,975 Class A Shares and 4,694,870 Class B Shares, which in the aggregate represent approximately 99.51% and 19.25% of all issued and outstanding Class A Shares and Class B Shares, respectively, and an aggregate of 66.56% of the total voting rights of the Company.Shaymar has advised the Company that it intends to tender approximately 4,694,870 Class B Shares to the Offer.

Orca expects to promptly mail to Shareholders the formal offer to purchase, issuer bid circular, letter of transmittal, notice of guaranteed delivery and other related documents (the “Offer Documents“) containing the terms and conditions of the Offer, instructions for tendering Shares, and the factors considered by Orca and its Board of Directors in making its decision to approve the Offer, among other things. The Offer Documents have been filed with the applicable Canadian securities regulators and are available free of charge on Orca’s SEDAR profile at www.sedar.com.

Orca’s Board of Directors has approved the making of the Offer and the purchase price for Class B Shares. However, none of Orca, its Board of Directors nor the depositary makes any recommendation to any Shareholder as to whether to deposit or refrain from depositing any Shares under the Offer. Shareholders are urged to evaluate carefully all information in the Offer, consult their own financial, legal, investment and tax advisors and make their own decisions as to whether to deposit Class B Shares under the Offer and, if so, how many such Shares to deposit and at what price or prices.

This news release is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell Class B Shares. The solicitation and the offer to buy the Class B Shares will only be made pursuant to Offer Documents filed with the applicable Canadian securities regulators. The Offer will be optional for all Shareholders, who will be free to choose whether to participate, how many Shares to tender and, in the case of auction tenders, at what price to tender within the specified range. Any Shareholder who does not deposit any Shares (or whose Class B Shares are not repurchased under the Offer) will realize a proportionate increase in equity interest in Orca, to the extent that Class B Shares are purchased under the Offer.

Orca has retained AST Trust Company (Canada) (“AST“) to act as depositary. Any questions or requests for information may be directed to AST, as the depositary for the Offer, at 1 (800) 387-0825 (Toll Free – North America) or 1 (416) 682-3860 (outside North America).

Orca Energy Group Inc.

Orca is an international public company engaged in natural gas exploration, development and supply in Tanzania through its subsidiary PanAfrican Energy Tanzania Limited. Orca trades on the TSX Venture Exchange under the trading symbols ORC.A and ORC.B.

For further information please contact:

Jay Lyons, Interim CEO
jlyons@orcaenergygroup.com
+44-7798-502316

Blaine Karst, CFO
bkarst@orcaenergygroup.com
+44-7471-902734

For media enquiries:
Celicourt (PR)
Mark Antelme
Jimmy Lea
+44 (0)20 8434 2754

orca@celicourt.uk

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

Certain information regarding Orca set forth in this news release, including but not limited to: the aggregate amount of Class B Shares to be purchased for cancellation under the Offer; the expected expiration date of the Offer; the Company’s expectation that it will fund any purchases of Class B Shares pursuant to the Offer from cash on hand; and Shaymar’s stated intention to tender 4,694,870 Class B Shares to the Offer, constitute “forward-looking information” within the meaning of applicable Canadian securities laws. The words “may”, “will”, “would”, “should”, “could”, “expects”, “plans”, “intends”, “trends”, “indications”, “anticipates”, “believes”, “estimates”, “predicts”, “likely” or “potential” or the negative or other variations of these words or other comparable words or phrases, are intended to identify forward-looking information. Forward-looking information, by its very nature, involves inherent risks and uncertainties and is based on several assumptions, both general and specific. Orca cautions that its assumptions may not materialize and that current economic conditions render such assumptions, although believed reasonable at the time they were made, subject to greater uncertainty. Such forward-looking information is not a guarantee of future performance and involves known and unknown risks, uncertainties and other factors which may cause the actual results or performance of Orca to be materially different from the outlook or any future results or performance implied by such information.

The forward-looking information contained in this new release is provided as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless so required by applicable Canadian securities laws.

Orca Energy Group Inc. Announces Intention to Commence Substantial Issuer Bid

TORTOLA, BRITISH VIRGIN ISLANDS – December 3, 2020 – Orca Energy Group Inc. (“Orca” or the “Company” including its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) announces today its intention to commence a substantial issuer bid of up to C$40 million (the “Offer“) pursuant to which the Company will offer to purchase for cancellation a portion of its Class B Subordinate Voting Shares (the “Class B Shares“) at a price range of between C$6.50 and C$7.50 per share. The Company intends to fund the Offer from current cash resources.

Under the Offer, which remains subject to the receipt of a satisfactory liquidity opinion from the Company’s financial adviser and approval of the Board of Directors, shareholders will have the opportunity to tender their shares through a modified Dutch auction tender. The Offer will not be conditional upon any minimum number of shares being tendered and will be subject to conditions customary for transactions of this nature.

Assuming the Offer is fully subscribed and completed, the Company will have distributed approximately C$132 million in dividends and share buybacks since February 2018.

This news release is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell the Company’s shares. The Offer referred to in this news release has not yet commenced. The solicitation and the offer to buy the shares will only be made pursuant to a separate issuer bid circular which will contain full details of the Offer, be filed with the Canadian securities regulatory authorities and mailed to the Company’s registered shareholders.

Jay Lyons, Interim Chief Executive Officer, commented:

“Following our strong cash generation and operational performance to date in 2020 relative to our peers, I am pleased to announce Orca’s intention to launch a substantial issuer bid of C$40 million. The substantial issuer bid we completed earlier in 2020 was well-received by the market and we believe it is an effective way for the Company to reward its investors, by returning value to them. This also comes on the back of the quarterly cash dividend we declared earlier this month, all of which demonstrates our commitment to returning excess capital to shareholders as appropriate.”

Orca Energy Group Inc.

Orca Energy Group Inc. is an international public company engaged in natural gas exploration, development and supply in Tanzania through its subsidiary PanAfrican Energy Tanzania Limited. Orca trades on the TSX Venture Exchange under the trading symbols ORC.A and ORC.B.

For further information please contact:

Jay Lyons, Interim CEO
jlyons@orcaenergygroup.com

Blaine Karst, CFO
bkarst@orcaenergygroup.com

For media enquiries please contact:
Celicourt (PR)
Mark Antelme
Jimmy Lea
+44 (0)20 8434 2754

orca@celicourt.uk

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

Certain information regarding Orca set forth in this news release, including but not limited to: the Offer being approved by the Board of Directors and regulatory authorities; the Offer not occurring as expected; any failure of any condition to the Offer; the extent to which shareholders elect to tender their shares under the Offer; the Company having sufficient financial resources and working capital following completion of the Offer; the Offer launching and/or being completed; and the Company’s commitment and ability to return capital to shareholders constitutes “forward-looking information” within the meaning of applicable Canadian securities laws. The words “may”, “will”, “would”, “should”, “could”, “expects”, “plans”, “intends”, “trends”, “indications”, “anticipates”, “believes”, “estimates”, “predicts”, “likely” or “potential” or the negative or other variations of these words or other comparable words or phrases, are intended to identify forward-looking information. Forward-looking information, by its very nature, involves inherent risks and uncertainties and is based on several assumptions, both general and specific. Orca cautions that its assumptions may not materialize and that current economic conditions render such assumptions, although believed reasonable at the time they were made, subject to greater uncertainty. Such forward-looking information is not a guarantee of future performance and involves known and unknown risks, uncertainties and other factors which may cause the actual results or performance of Orca to be materially different from the outlook or any future results or performance implied by such information.

The forward-looking information contained in this new release is provided as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless so required by applicable Canadian securities laws.

Orca Energy Group Inc. Announces Completion of its Q3 Interim Filings

TORTOLA, BRITISH VIRGIN ISLANDS – November 18, 2020: Orca Energy Group Inc. (“Orca” or “the Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) today announces it has filed its condensed consolidated interim financial statements and management’s discussion and analysis for the three and nine month periods ended September 30, 2020 with the Canadian securities regulatory authorities. All amounts are in United States dollars (“$”) unless otherwise stated.

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