Orca Issuer Bid Circular

Orca Exploration Group Inc. (“Orca”, the “Company”, “we”, “us” or “our”) hereby offers, upon the terms and subject to the conditions described herein, to purchase for cancellation a number of Orca’s Class B Subordinate Voting Shares (the “Class B Shares”) for an aggregate purchase price not exceeding C$50,000,000. Only Class B Shares will be taken up and purchased for cancellation pursuant to the Offer. Holders of Orca’s Class A Common Shares (the “Class A Shares” and collectively with the Class B Shares, the “Shares”) are entitled to participate in the Offer by depositing their Class A Shares to the Offer. Only those Class A Shares taken up by the Company will be converted into Class B Shares immediately prior to take up.

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Orca Exploration Group Inc. Announces Commencement of Substantial Issuer Bid up to CDN$50 Million

TORTOLA, British Virgin Islands, January 28, 2020: Orca Exploration Group Inc. (“Orca” or the “Company”and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) today is commencing its previously announced substantial issuer bid pursuant to which the Company will offer to purchase for cancellation up to CDN$50 million 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 The Offer will expire at 5:00 p.m. (Toronto time) on March 4, 2020, unless extended, varied or withdrawn by Orca.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 CDN$6.50 and not more than CDN$7.50 per Class B Share (in increments of CDN$0.05 per 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 CDN$7.50 and not less than CDN$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that will allow it to purchase the maximum number of Class B Shares properly tendered to the Offer, and not properly withdrawn, having an aggregate purchase price not exceeding CDN$50 million.

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 CDN$6.50 and not more than CDN$7.50 per Class B Share in increments of CDN$0.05 per 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 CDN$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 CDN$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 32,557,185 Class B Shares and 1,750,567 Class A Shares issued and outstanding. Shaymar Limited (“Shaymar”) holds 1,741,975 Class A Shares and 5,392,460 Class B Shares, which in the aggregate represent approximately 99.51% and 16.56% of all issued and outstanding Class A Shares and Class B Shares, respectively, and an aggregate of 59.54% of the total voting rights of the Company. Shaymar has advised the Company that it intends to tender approximately 1,700,000 Class B Shares to the Offer.

Orca expects to promptly mail 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, its Special Committee 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 upon the recommendation of its Special Committee. However, none of Orca, its Special Committee or its Board of Directors or 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 RBC Capital Markets to act as financial advisor in connection with the Offer and 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 Exploration 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:

Nigel Friend, CEO
nfriend@orcaenergygroup.com

Blaine Karst, CFO
bkarst@orcaenergygroup.com

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, 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 1,700,000 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.

Material Change Report

On January 24, 2020, Orca announced the authorization of a substantial issuer bid, the outcome of its strategic review process, and its focused strategy to grow an integrated gas business in Africa.

Based on the alternatives available to the Company, the special committee (“Special Committee”) of Orca recommended, and the board of directors (the “Board”) of Orca concluded, that it is in the best interests of the Company and its shareholders (“Shareholders”) to continue operating as an independent company with a view to enhancing value to its Shareholders through a balanced approach, focused on:

  1. Return of Capital: The return of retained cash to Shareholders in the form of share purchases and/or dividends;
  2. Value maximization of the Songo Songo Production Licence: The continued value maximization and monetization of the Company’s Songo Songo natural gas field in Tanzania; and
  3. Sustainable Growth: Strategic reinvestment utilizing the Company’s core competency to develop a sustainable, integrated gas business in Africa with accretive returns.

In conjunction with the announcement of this strategy, the Company announced its intention to return a portion of its excess cash to Shareholders through a substantial issuer bid.

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Orca Exploration Group Inc. Announces Authorization of Substantial Issuer Bid, Provides Outcome of Strategic Review Process and Announces Focused Strategy to Grow Integrated Gas Business in Africa.

TORTOLA, British Virgin Islands, Jan. 24, 2020 (GLOBE NEWSWIRE) — Orca Exploration Group Inc. (“Orca” or the “Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) announced today the authorization of a substantial issuer bid, the outcome of its strategic review process, and its focused strategy to grow an integrated gas business in Africa.

Outcome of Strategic Review Process

With the assistance of its financial advisor, RBC Capital Markets, the special committee (the “Special Committee”) of the board of directors of the Company (the “Board of Directors”) completed a thorough review of the options available to the Company to maximize shareholder value. As part of the strategic review, the Special Committee considered and evaluated a substantial issuer bid, a secondary listing of the Company’s shares on another exchange, a reorganization of the Company’s share capital, a secondary offering of the Company’s outstanding shares, and the acquisition of the Company or other arrangement, merger transaction or business combination with another company resulting in asset and/or jurisdiction diversification and a larger, more liquid market, for the equity of the combined company.

Based on the alternatives available to the Company, the Special Committee has recommended, and the Board of Directors has concluded, that it is in the best interests of the Company and its shareholders to continue operating as an independent company with a view to enhancing value to its shareholders through a balanced approach, focused on:

  1. Return of Capital: The return of retained cash to shareholders in the form of share repurchases and/or dividends.
  2. Value Maximization of the Songo Songo Production Licence: The continued value maximization and monetization of the Company’s rights to develop the Songo Songo natural gas field in Tanzania; and
  3. Sustainable Growth: Strategic reinvestment utilizing the Company’s core competency to develop a sustainable, integrated gas business in Africa with accretive returns.

In conjunction with the announcement of this strategy, the Company intends to return a portion of its excess cash to shareholders through a substantial issuer bid. See “Return of Capital and Announcement of Substantial Issuer Bid” below. The Company also plans to introduce a dividend policy in the first half of 2020 providing for regular dividends determined on an annual basis, and will assess from time-to-time incremental returns of capital to shareholders relative to the merits of available investment opportunities.

Nigel Friend, Chief Executive Officer, commented:
“We are pleased to have concluded the strategic review process. On the back of our strong performance in 2019, it is now the right time to return a portion of our retained cash back to shareholders through a substantial issuer bid. The prudent management of capital and regular distributions to our shareholders will continue to be a core part of our strategy.

We believe that the decision to focus on generating material returns for shareholders via organic growth and strategic reinvestment of retained capital into other African gas opportunities, will enable the Board of Directors and management to deliver accretive value to shareholders going forward.

Given the strength of Orca’s operations and the Company’s balance sheet, we are well placed to deliver on the agreed mandate outlined by the strategic review process.”

Return of Capital and Announcement of Substantial Issuer Bid

During 2019, Orca completed a normal course issuer bid (“NCIB”) for the purchase of its Class B Subordinated Voting Shares (the “Class B Shares”). Under the NCIB, the Company purchased 933,028 Class B Shares at a weighted average price of CDN$6.43 for an aggregate consideration of CDN$6 million.

The Company also paid a special dividend of CDN$0.60 per share in February 2018 and three quarterly dividends in 2019 totaling CDN$0.17 per share. In addition, a dividend of CDN$0.06 per share has been declared and is payable on 31 January 2020. Upon payment of this 31 January 2020 dividend, the Company will have returned approximately CDN$29 million in dividends to shareholders in the last two years.

The Company announced today that the Board of Directors has authorized management to finalize the terms and conditions for a substantial issuer bid of up to CDN$50 million pursuant to which the Company will offer to purchase a portion of its Class B Shares (the “Offer”). The Company anticipates that the Offer will commence during the next two weeks and will be completed before the end of the first quarter of 2020. The Company intends to fund the Offer from current cash resources.

Under the Offer, which remains subject to the recommendation of the Special Committee and Board of Directors approval, 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 CDN$85 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.

Maximizing the Value of the Songo Songo Production Licence

2019 was a successful year for the Company’s operation in Tanzania. The highlights include:

  • An increase in 2019 sales volumes to 63.1 million standard cubic feet per day (“MMscfd”) (2018: 39.9 MMscfd). In Q4 2019, sales volumes averaged 70.8 MMscfd (Q4 2018: 44.8 MMscfd). The weighted average sales price for 2019 gas deliveries was US$4.38 per thousand cubic feet (“mcf”) (2018: US$5.17/mcf). In Q4 2019, the weighted average sales price was US$4.24/mcf (Q4 2018: US$4.31/mcf).
  • The signing of a gas sales agreement with Tanzania Petroleum Development Corporation for up to 20 MMscfd (and subsequently increased to 30 MMscfd, with the increased volumes being supplied on a reasonable endeavours basis) to be processed and transported to Dar es Salaam through the National Natural Gas Infrastructure (“NNGI”). The NNGI processing plant on Songo Songo Island has a gas processing capacity of 140 MMscfd.
  • The installation, testing and commissioning of a refrigeration unit on the Songas gas processing facility that is operated by the Company. The addition of the refrigeration unit has increased the volumes that can be transported from the field to Dar es Salaam through the Songas facilities (which are operated by Orca on behalf of Songas) to 97 MMscfd.
  • Capital expenditures for 2019 were US$4.2 million (2018: US$5.8 million). For 2020, capital expenditures are forecasted at US$50.3 million which includes the design and installation costs of a compression unit for the Songas gas processing facility, debottlenecking the flow-line infrastructure, and estimated costs to workover certain wells and other expenditures on the Company’s downstream network.
  • The receipt of US$61.6 million during 2019 from the electricity utility, the Tanzanian Electricity Supply Company, against 2019 invoices for deliveries of US$50.6 million. These excess payments reduced the long-term receivable from TANESCO for prior years’ unpaid gas deliveries to US$47.5 million at December 31, 2019 (December 31, 2018: US$58.5 million). The current TANESCO receivable at December 31, 2019 was nil (December 31, 2018: nil).
  • Cash and short-term investments totaled US$138.7 million at December 31, 2019 (December 31, 2018: US$131.5 million).

The financial highlights described above relating to sales volumes, sales prices, capital expenditures, revenues, cash receipts, receivables, and cash and short-term investments are management estimates only, are unaudited and have not been reviewed by our auditors.

It is anticipated that there will continue to be strong demand for the Songo Songo field’s natural gas through to the end of the Production Sharing Agreement (“PSA”) on 11 October 2026. Demand growth will be driven primarily by the installation of new gas fired power generation capacity and increased consumption from the existing industrial base. While the timing is not yet confirmed, the additional generation at Kinyerzi near Dar es Salaam is expected to commence in the third quarter of 2020, building up to 185MW combined cycl generation capacity in the fourth quarter of 2020.

To sustain current levels of production beyond 2020, it will be necessary to install compression facilities to optimize throughput capacity of the Songas facilities over the remaining term of the PSA and underlying licence. Failure to incorporate compression would lead to a significant loss in production through the Songas facilities as field pressure declines below the level required to deliver gas to the power sector in Dar es Salaam and our industrial customers over time. On 23 December 2019, a Letter of Instruction was signed with an international contractor with significant presence and experience in Tanzania for the commencement of detailed engineering and design for the compression project. A definitive agreement for the project is expected to be signed by the end of February 2020 on a fixed price, turnkey basis. It is forecast that compression will be operational by the end of 2021 and cost approximately US$38 million of which US$34.2 million is forecasted to be spent in 2020.

Orca is evaluating the merits of conducting three workovers on the onshore wells, namely SS-3, SS-4 and SS-10. SS-3 and SS-4 are owned by Songas and are currently shut-in. A decision on the timing and scope of the workovers is subject to the approval of the Board of Directors and agreement with Songas and will likely to be taken by the end of Q2 2020. A cost of US$13.1 million has been included in the 2020 budget for the three workovers. A portion of this cost is expected to be recovered from third parties. In the meantime, the Board of Directors has approved debottlenecking the flow-line infrastructure to increase production potential from the SS-10 and SS-11 wells (both of which are owned by the Company) at an estimated cost of US$1.3 million to be incurred in 2020.

It is estimated that Orca will need to invest approximately US$80.2 million in debottlenecking, compression and workovers to sustain and meet the anticipated gas demand profile over the remaining term of the PSA. The Board of Directors has approved US$39.3 million of this forecasted capital expenditure amount (US$35.5 million for 2020 and US$3.8 million for 2021). Orca intends to recover investments of sustaining capital from net revenues under the cost recovery mechanism in the PSA.

The Government of Tanzania is currently reviewing for potential renegotiation the terms of all existing licences and related production sharing agreements for the exploration, development and production of oil and gas in Tanzania. While the details or outcome of this review are not yet known, the Government of Tanzania has previously indicated it will present the relevant parties with its conclusions and plans during the first half of 2020. This may result in the Government seeking to re-negotiate the terms of our existing PSA.

As at 30 June 2019, the Company had best estimate (unrisked) contingent resources of 683 Bcf remaining (risked:341 Bcf) within the Songo Songo licence acreage that may be accessed through the drilling of new gas wells and the construction of flowlines to the gas processing infrastructure on Songo Songo Island, or processed and transported through the NNGI, assuming the term of the Songo Songo licence and PSA are extended. See Orca’s news release dated November 6, 2019 entitled “Orca Announces Independent Natural Gas
Resource Report”
for more details. While Orca is keen to extend the PSA beyond 2026 with a view to continuing to support Tanzania’s economic and industrial development, Orca will only agree to changes to the PSA and commitments to further investment in the field where the Songo Songo licence and PSA are extended on acceptable terms and there is a clear path to monetizing the gas with returns that are superior to other investment opportunities available to the Company.

Focused Strategy to Grow the Company’s Integrated Gas Business in Africa

Orca’s success has been built on the development and operation of its Songo Songo gas field in Tanzania, its midstream infrastructure and a downstream distribution network that transports and distributes low pressure gas to industrial consumers. This project remains one of the few integrated gas projects in sub- Saharan Africa.

One of Orca’s objectives moving forward is to replicate the success of this project elsewhere in Africa and become one of the leading African developers and operators of natural gas resources for domestic consumption. It is envisaged that a focused strategy targeting the consolidation of African gas assets will generate improved liquidity in Orca’s equity.

There have been some significant gas discoveries across Africa in the last 10 years, primarily in Mozambique, Tanzania, Ghana, Senegal and Mauritania. Given the size of these discoveries, it is likely they will be commercialized primarily through Liquid Natural Gas (“LNG”) projects that will see the export of gas to world markets. Orca intends to focus on proven gas resources that do not meet the LNG threshold, and, therefore commercialization will be focused on selling the gas into local domestic markets.

Africa has extensive untapped resources and latent energy demand. Its population is expected to increase by over 60% to 2.1 billion by 2040; one-in-two people added to the global population between today and 2040 is projected to be African.1 The continent’s urban population is set to grow by more than half a billion over that period which is expected to fuel significant economic growth and energy demand.2

It is estimated that 595 million people in Africa do not have access to electricity. Furthermore, most energy in sub-Saharan Africa (excluding South Africa) is used for cooking, which accounts for 70% of total final consumption.3 Solid biomass is the major source of energy used to meet cooking energy needs, the burning of which has material adverse environmental and social impacts. With plentiful solar, hydro and natural gas potential, Africa has a unique opportunity to develop and diversify its energy supply in an efficient and environmentally sound manner.

Natural gas is considered a transitional fuel that will facilitate and support the development of renewable energy sources. It is the only thermal fuel that is expected to increase its market share of energy demand over the period to 2040.4 While there has been a significant decrease in the availability of finance for oil and coal projects, it is expected that projects focussed on increasing the consumption of natural gas in Africa will be well supported given it generates lower carbon emissions compared to other thermal fuels and there are significant social benefits from delivering economic growth and prosperity to the continent through the development of indigenous natural gas resources.

During 2019, the Company built-out its business development team and capabilities and evaluated several investment opportunities, including potential business combinations. Orca intends to focus on acquiring and developing proven gas resources, or merging with entities that have existing gas production, in countries where there is robust market demand for natural gas. It is anticipated that developments would be project-financed once the gas reservoirs are proven to a level that supports the signing of a long-term gas sales agreements with credit-worthy customers. Orca would undertake detailed evaluation of all investment opportunities to ensure that capital is allocated to the most accretive projects. This includes further returns to shareholders where it is considered that the Company trades at a significant discount to its net asset value. Disciplined capital allocation, diversification and increased liquidity are central to Orca’s growth strategy.

Response to Swala Oil & Gas

As a part of the strategic review process and in consultation with its legal and financial advisors, the Special Committee carefully reviewed and considered the non-binding proposal (“Proposal”) from Swala Oil & Gas (Tanzania) plc (“Swala”). As a part of the review, Orca’s financial advisor engaged with Swala’s management, financial advisor, and financing sources to understand the details and plan outlined in the Proposal. Following that review, the Special Committee determined, and the Board of Directors agreed, that the Proposal did not constitute a basis for engaging in further dialogue with Swala. The primary reasons for this decision include:

  1. The Proposal is highly conditional, subject to financing uncertainty and remaining due diligence and significant uncertainty in the timing and ability to successfully announce and close the transaction; and
  2. The Proposal undervalues Orca and its future prospects and the majority of the consideration offered under the proposal is funded through Orca’s cash on hand.

Swala, through its indirect minority equity ownership in Orca’s affiliate, has detailed non-public information relating to Orca’s Tanzanian assets and, together with Orca’s publicly disclosed information, has sufficient information to make a fully-funded proposal which does not rely upon further fundamental due diligence. Additionally, the Proposal does not adequately address the tax and regulatory requirements of Tanzanian authorities that may have to be complied with in order for the transaction set out in the Proposal to be completed.

Under the Proposal, Swala sought to finance the purchase of Orca Shares by utilizing Orca’s cash resources at the time of approximately US$145.7 million and entering into US$75 million of new term loans secured against Orca’s future cash flows. It also should be noted that the Proposal does not include any cash equity financing from Swala, but instead relies on Orca’s cash, debt financing and Swala equity which has a relatively illiquid trading market. Swala is listed on the Dar es Salaam Stock Exchange with a market capitalization of approximately US$22.5 million. Swala’s most recent audited financial statements were filed on 19 December 2019 for the year ended 31 December 2018. In the Basis for Adverse Opinion section, KPMG (Swala’s auditor) states “in our opinion the Group and Company [Swala Oil and Gas (Tanzania) Public Limited Company] cannot be considered to be a going concern and thus the preparation of its consolidated and separate financial statements on a going concern basis is inappropriate”.

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Orca Exploration 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:
Nigel Friend, CEO
nfriend@orcaenergygroup.com
Blaine Karst, CFO
bkarst@orcaenergygroup.com

1 Source: International Energy Agency, Africa Energy Outlook 2019
2 Source: International Energy Agency, Africa Energy Outlook 2019

Orca Exploration Announces Quarterly Dividend

TORTOLA, British Virgin Islands, November 28, 2019: Orca Exploration Group Inc. (“Orca” or the “Company”) (TSX-V: ORC.A, ORC.B) today announces that its Board of Directors has declared a quarterly cash dividend of $0.06 (Cdn) per Class B Subordinate Voting Share of the Company. The dividend will be payable on January 31, 2020 to holders of Class A Common Voting Shares and Class B Subordinate Voting Shares of record on December 31, 2019.

Orca Exploration 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:

Nigel Friend, CEO
nfriend@orcaenergygroup.com

Blaine Karst, CFO
bkarst@orcaenergygroup.com

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.

Orca Announces Independent Natural Gas Resource Report

TORTOLA, British Virgin Islands, 6 November 2019: Orca Exploration Group Inc. (“Orca” or the “Company”) (TSX-V: ORC.A, ORC.B) announces its independent natural gas resource assessment report dated as of June 30, 2019 (the “Resource Report”).

All references to “natural gas” in this press release refer to “conventional natural gas”as defined in National Instrument 51-101 –Standards of Disclosure for Oil and Gas Activities(“NI 51-101”).The Resource Report was commissioned to provide our stakeholders with an understanding of the contingentand prospectivenatural gas resources in the Songo Songo licence acreage in Tanzania that is subject to the terms of the Songo Songo Production Agreement (the “Songo Songo PSA”).The Resource Report is based on the Company’s 92.07% interest in the Songo Songo PSA.

Click here to read the full report

Orca Exploration provides operational update

TORTOLA, British Virgin Islands, 2 October 2019: Orca Exploration Group Inc. (“Orca” or the “Company”) (TSX-V: ORC.A, ORC.B) is pleased to provide the following operational update on its current activities in Tanzania.

Orca’s Additional Gas sales increased to 64 million standard cubic feet a day (“MMscfd”) in August 2019, taking the average for the year to date to 60 MMscfd (8 months ended 31 August 2018: 37 MMscfd). On September 25, 2019, an agreement was reached with the Tanzania Petroleum Development Corporation (the “TPDC”) to increase the maximum daily quantity of Additional Gas that can be supplied under Orca’s Gas Sales Agreement with the TPDC to 30 MMscfd (from 20 MMscfd). This Additional Gas will be processed and transported to Dar es Salaam through the National Natural Gas Infrastructure (“NNGI”).

The Company is actively pursuing new sales opportunities in Tanzania. The Company is assisting the Tanzanian Government in evaluating the potential to supply large volumes of natural gas to strategic partners in the East African region. Supplying those strategic partners would require Orca to develop the northern section of the Songo Songo field (“SSN”) where there was a natural gas discovery in 1974. In addition, the Company is in discussions with commercial fuel distributors and other potential consumers to expand its existing compressed natural gas business.

Orca remains well placed to deliver additional volumes to the proposed new 185 MW gas fired generation facility at Kinyerezi 1, via the NNGI. Whilst efforts to progress the project continue, Orca believes the plant will not be operational before mid-2020, as opposed to late 2019.

Orca has continued to optimise the refrigeration system at the Songas facility and final performance testing is expected to commence during October. This follows recent adjustments to operational settings on the Songas facility that together are expected to see processing capacity return to approximately 100 MMscfd.

Concurrently, Orca is nearing completion of the front-end engineering and design for compression for the Songas facility. Refrigeration and compression will work in harmony to address declining reservoir pressure to ensure maximum production levels can be sustained, subject to demand, through to the end of the PSA licence in 2026. Alongside this, Orca is developing plans to workover three onshore wells to address corrosion, sand and water issues. Successful workovers are expected to return around 21 MMscfd of additional production potential from the field, at an estimated cost of US$15million.

Nigel Friend, CEO of Orca commented: 

“The Government of Tanzania is actively looking at ways to utilise its significant indigenous natural gas resources to fuel industrial and economic growth for the benefit of the country and the wider East African region. We are encouraged by this increased activity and, in conjunction with our partner, TPDC, are evaluating the options to increase production from the Songo Songo field to ensure that natural gas is available to support the Government’s objectives in a timely manner”.

Orca Exploration Group Inc.

Orca is an international public company engaged in natural gas exploration, development and supply in Tanzania through its subsidiary PAET. Orca trades on the TSX Venture Exchange under the trading symbols ORC.A and ORC.B. The Company’s Project Agreements are more fully described in the Company’s 2016 Annual Information Form, and available on www.orcaenergygroup.com.

For further information please contact:

Nigel Friend, CEO
nfriend@orcaenergygroup.com

Blaine Karst, CFO
bkarst@orcaenergygroup.com

For media enquiries:
Celicourt (PR)
Mark Antelme
Jimmy Lea
Jemima Lowe
Orca@celicourt.uk
+44-207-5209261

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 Announces Quarterly Dividend

TORTOLA, British Virgin Islands, 17 September 2019: Orca Exploration Group Inc. (“Orca” or the “Company”) (TSX-V: ORC.A, ORC.B) today announced that its Board of Directors has declared a quarterly cash dividend of $0.06 (Cdn) per Class A Common Voting Share of the Company and $0.06 (Cdn) per Class B Subordinate Voting Share of the Company. The dividend will be payable on October 31, 2019 to holders of Class A Common Voting Shares and Class B Subordinate Voting Shares of record on September 30, 2019.

Orca Exploration 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:

Nigel Friend, CEO
nfriend@orcaenergygroup.com

Blaine Karst, CFO
bkarst@orcaenergygroup.com

For media enquiries:
Celicourt (PR)
Mark Antelme
Jimmy Lea
Jemima Lowe
Orca@celicourt.uk
+44-207-5209261

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.