TSX-V: ORC.A, ORC.B
TORTOLA, British Virgin
Islands, May 29, 2014 /CNW/ -
Orca Exploration Group Inc. ("Orca" or "the Company") announces its
results for the quarter ended 31 March
2014.
- Orca operated its Tanzania Songo Songo gas field in the first
quarter of 2014 near its productive capacity delivering Additional
Gas sales volumes averaging 57.4 MMcfd, a decrease of 7% over the
same period in 2013 (Q1 2013: 61.6 MMcfd) and a decrease of 4% over
Q4 2013 (60.1 MMcfd). Overall production of Protected Gas and
Additional Gas was down 2% over Q1 2013 at 94 MMcfd (Q1 2013: 96
MMcfd). Current average production is approximately 94 MMcfd with
current volumes down to approximately 82 MMcfd due to seasonally
high hydro usage by TANESCO.
- The situation with respect to the outstanding accounts
receivable from TANESCO remains urgent. In the event that the
Company does not collect from TANESCO the balance of the
receivables and TANESCO continues to be unable to pay the Company
for subsequent gas deliveries, the Company will need additional
funding for its ongoing operations by the end of the 2014 fiscal
year.
- Working capital was US$19.1
million at 31 March 2014, down
65% over Q1 2013 (US$54.8 million), a
result of reclassifying US$59.3
million (prior to discount) of TANESCO debt as a long-term
receivable. As at 31 March 2014,
TANESCO owed the Company US$68.6
million of which US$63.9
million was in arrears.
- TANESCO currently owes the Company US$60.9 million, of which US$57.6 million is in arrears. During the
quarter, the Company served notice to TANESCO and is actively
pursuing legal and contractual options available to collect the
arrears and arrest the increase in TANESCO receivables, including
but not limited to the suspension of gas deliveries to TANESCO.
- TANESCO has made some effort to arrest the growth of arrears.
The Tanzania Ministry of Energy and Minerals ("MEM"), which
oversees TANESCO, directed the state utility to seek to establish a
regular basis of payments to its creditors given the increased cash
flow from higher power tariffs which came into effect in
January 2014. TANESCO has stated an
intention to pay TZsh 3 billion (US$1.8
million) weekly. Management is currently negotiating a
formalized arrangement with TANESCO to repay the arrears and ensure
payment for ongoing gas deliveries remains current.
- Q1 earnings were US$1.6 million
or US$0.04 per share diluted, down
47% from the prior year period (Q1 2013: US$2.9 million or US$0.08 per share) and compared with a loss of
US$3.9 million or US$0.11 per share in Q4 2013, again reflecting
the cost of carrying the TANESCO receivable and provisioning a
further US$2.6 million (Q4 2013:
US$2.2 million) against doubtful
debts, primarily Songas.
- Average gas prices were up 2% in Q1 to US$4.55/mcf over the prior year period (Q1 2013:
US$4.45/mcf), Industrial gas prices
were up 4% in Q1 to US$8.11/mcf (Q1
2013: US$7.78/mcf) and down 3% from
Q4 2013 (US$8.38/mcf) from changes in
the sales mix. Average Power sector gas prices decreased 1% over
the prior year period to US$3.52/mcf
(Q1 2013: US$3.55/mcf) and down 4%
compared to the Q4 2013 price of US$3.68/mcf, a result of a reduced take at higher
marginal prices.
- Gross revenue for the quarter was US$23.9 million, down 3% from the prior year
period (Q1 2013: US$24.6 million),
with the Company's share of revenue down 5% from US$12.7 million to US$12.1 million. Cost Pool
recoveries contributing to operating revenue remained low at
US$2.3 million (Q1 2013: US$3.6 million) due to minimal capital spending
during the quarter.
- Funds flow from operating activities was down 20% to
US$7.1 million or US$0.20 per share diluted (Q1 2013: US$8.9 million or US$0.25 per share), a result of lower net
revenues.
- As at 31 March 2014, the Company
had US$31.1 million in cash
(31 December 2013: US$32.6 million) and no debt, more than double
the cash balances of the prior year. Notwithstanding the stronger
cash position, the continued TANESCO and Songas non-payment still
threatens the Company's viability and the Company has maintained a
going concern note in its Q1 2014 Interim Consolidated Financial
Statements. The Company currently has US$40
million in cash and no debt.
- During the quarter, Company ended negotiations on potential
amendments to the Songo Songo Production Sharing Agreement (the
"PSA") and on Government Negotiating Team issues having obtained a
full retraction by the Tanzania Petroleum Development Corporation
("TPDC") of the alleged over-recovery of US$21 million in Cost Pools and TPDC having
confirmed that the matter was now closed. The claim was the
cornerstone of Parliament's 2011 resolution advising the Government
that the Company should repay the monies and that the PSA be
terminated. The Company continues to use the dispute resolution
mechanisms in its agreements to address any and all pertinent
issues going forward.
- Establishing commercial terms for future incremental gas sales
remains a key condition to the Company's commitment to Songo Songo development - again there were no
substantive developments in negotiations during the quarter. In the
absence of an agreement in the near future, the Company intends to
pursue its rights under the PSA to develop other markets for
Songo Songo gas.
- Despite the stalled efforts to reach agreement on commercial
terms, the Company continued planning the full development of
Songo Songo to reach 190 MMcfd
deliverability by mid-2015, and commenced detailed engineering work
on potential workovers of two of the more prolific producing wells
currently suspended, SS-5 and SS-9. The Company continues to work
with the International Finance Corporation of the World Bank Group
to finance the development programme. All development work remains
contingent upon (i) satisfactory resolution of TANESCO arrears;
(ii) acceptable commercial terms for future gas sales to TPDC; and
(iii) payment guarantees for future gas deliveries to TPDC.
- The Tanzania National Natural Gas Infrastructure Project
("NNGIP") made significant progress, as reported by TPDC during
2013, with the pipeline currently 72% complete and gas processing
facilities 58% complete. Expected onstream date remains
mid-2015.
Financial and Operating Highlights
|
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|
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THREE MONTHS ENDED/AS AT |
Three months ended/As at |
|
|
|
|
|
31-Mar-2014 |
|
|
31-Mar-
2013 |
|
|
Percentage
Change |
|
|
31-Dec-2013 |
|
|
Percentage
Change |
Financial (US$000 except where otherwise
stated) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
|
|
|
|
13,698 |
|
|
13,197 |
|
|
4 |
|
|
14,866 |
|
|
(8) |
Profit/(Loss) before tax |
|
|
|
|
|
3,246 |
|
|
4,660 |
|
|
(30) |
|
|
(3,749) |
|
|
n/m |
Operating netback (US$/mcf) |
|
|
|
|
|
2.03 |
|
|
2.15 |
|
|
(6) |
|
|
2.29 |
|
|
(11) |
Cash |
|
|
|
|
|
31,058 |
|
|
13,421 |
|
|
131 |
|
|
32,588 |
|
|
(5) |
Working capital (1) |
|
|
|
|
|
19,060 |
|
|
54,757 |
|
|
(65) |
|
|
27,756 |
|
|
(31) |
Shareholders' equity |
|
|
|
|
|
121,851 |
|
|
128,885 |
|
|
(5) |
|
|
120,252 |
|
|
1 |
Total comprehensive income/(loss) |
|
|
|
|
|
1,573 |
|
|
2,950 |
|
|
(47) |
|
|
(3,918) |
|
|
n/m |
per
share - basic (US$) |
|
|
|
|
|
0.05 |
|
|
0.08 |
|
|
(38) |
|
|
(0.11) |
|
|
n/m |
per
share - diluted (US$) |
|
|
|
|
|
0.04 |
|
|
0.08 |
|
|
(50) |
|
|
(0.11) |
|
|
n/m |
Funds flow from operating activities
(2) |
|
|
|
|
|
7,104 |
|
|
8,904 |
|
|
(20) |
|
|
8,744 |
|
|
(19) |
per share from operating
activities - basic (US$) |
|
|
|
|
|
0.20 |
|
|
0.25 |
|
|
(20) |
|
|
0.26 |
|
|
(23) |
per share from operating
activities - diluted (US$) |
|
|
|
|
|
0.20 |
|
|
0.25 |
|
|
(20) |
|
|
0.26 |
|
|
(27) |
Net cash flows from operating activities |
|
|
|
|
|
660 |
|
|
(5,748) |
|
|
n/m |
|
|
5,566 |
|
|
(88) |
per share -
basic (US$) |
|
|
|
|
|
0.02 |
|
|
(0.17) |
|
|
n/m |
|
|
0.16 |
|
|
(88) |
per share -
diluted (US$) |
|
|
|
|
|
0.02 |
|
|
(0.16) |
|
|
n/m |
|
|
0.16 |
|
|
(88) |
Outstanding Shares ('000) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A shares |
|
|
|
|
|
1,751 |
|
|
1,751 |
|
|
- |
|
|
1,751 |
|
|
- |
Class B shares |
|
|
|
|
|
33,072 |
|
|
32,892 |
|
|
1 |
|
|
33,072 |
|
|
- |
Options |
|
|
|
|
|
1,742 |
|
|
1,922 |
|
|
(9) |
|
|
1,742 |
|
|
- |
Operating |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional Gas sold (MMcf) -
Industrial |
|
|
|
|
|
1,164 |
|
|
1,176 |
|
|
(1) |
|
|
1,143 |
|
|
2 |
Additional Gas sold (MMcf) - Power |
|
|
|
|
|
4,008 |
|
|
4,363 |
|
|
(8) |
|
|
4,385 |
|
|
(9) |
Additional Gas sold (MMcfd) -
Industrial |
|
|
|
|
|
12.9 |
|
|
13.1 |
|
|
(2) |
|
|
12.4 |
|
|
4 |
Additional Gas sold (MMcfd) - Power |
|
|
|
|
|
44.5 |
|
|
48.5 |
|
|
(8) |
|
|
47.7 |
|
|
(7) |
Additional Gas sold (MMcfd) - Total |
|
|
|
|
|
57.4 |
|
|
61.6 |
|
|
(7) |
|
|
60.1 |
|
|
(4) |
Average price per mcf (US$) -
Industrial |
|
|
|
|
|
8.11 |
|
|
7.78 |
|
|
4 |
|
|
8.38 |
|
|
(3) |
Average price per mcf (US$) - Power |
|
|
|
|
|
3.52 |
|
|
3.55 |
|
|
(1) |
|
|
3.68 |
|
|
(4) |
|
|
1. |
|
Working capital as at 31 March 2014 includes a TANESCO
receivable of US$9.3million (31 December 2013: US$9.6
million).
Given the payment pattern, the TANESCO receivables in excess of
60 days which total US$59.3 million (31 December 2013:
US$47.0 million) have been classified as long-term
receivables and discounted by US$17.1 million. Total long and
short-term
TANESCO receivables as at 31 March 2013 were US$68.6 million
prior to discounting. Subsequent to the quarter end,
TANESCO paid US$10.9 million, and as at 29 May 2014 the TANESCO
balance was US$60.9 million of which arrears
total US$57.6 million. |
|
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2. |
|
See MD&A - Non-GAAP Measures. |
|
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|
|
|
Condensed Consolidated Interim Statement of
Comprehensive Income (Unaudited)
ORCA EXPLORATION GROUP INC.
|
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|
|
|
Three
months ended |
US$'000 except per share
amounts |
|
|
|
|
|
NOTE |
|
|
|
31 Mar 2014 |
|
|
31 Mar 2013 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
|
|
|
|
3, 4 |
|
|
|
13,698 |
|
|
13,197 |
Cost of sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
Production and distribution expenses |
|
|
|
|
|
|
|
|
|
(1,260) |
|
|
(794) |
Depletion expense |
|
|
|
|
|
|
|
|
|
(3,563) |
|
|
(2,722) |
|
|
|
|
|
|
|
|
|
|
8,875 |
|
|
9,681 |
General and administrative expenses |
|
|
|
|
|
|
|
|
|
(3,794) |
|
|
(3,530) |
Finance income |
|
|
|
|
|
5 |
|
|
|
760 |
|
|
- |
Finance costs |
|
|
|
|
|
5 |
|
|
|
(2,595) |
|
|
(1,491) |
Profit before tax |
|
|
|
|
|
|
|
|
|
3,246 |
|
|
4,660 |
Income taxes |
|
|
|
|
|
6 |
|
|
|
(1,660) |
|
|
(1,886) |
Profit after tax |
|
|
|
|
|
|
|
|
|
1,586 |
|
|
2,774 |
Foreign currency translation (loss)/gain from
foreign operations |
|
|
|
|
|
|
|
|
|
(13) |
|
|
176 |
Total comprehensive income for the
period |
|
|
|
|
|
|
|
|
|
1,573 |
|
|
2,950 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic (US$) |
|
|
|
|
|
13 |
|
|
|
0.05 |
|
|
0.09 |
Diluted (US$) |
|
|
|
|
|
13 |
|
|
|
0.04 |
|
|
0.08 |
See accompanying notes to the condensed
consolidated interim financial statements.
Condensed Consolidated Interim Statement of
Financial Position (Unaudited)
ORCA EXPLORATION GROUP INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
at |
US$'000 |
|
|
|
|
|
|
|
|
|
|
NOTE |
|
|
|
31-Mar 2014 |
|
|
31-Dec 2013 |
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31,058 |
|
|
32,588 |
Trade and other receivables |
|
|
|
|
|
|
|
|
|
|
8 |
|
|
|
35,346 |
|
|
37,215 |
Tax receivable |
|
|
|
|
|
|
|
|
|
|
6 |
|
|
|
14,364 |
|
|
14,585 |
Prepayments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
712 |
|
|
281 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
81,480 |
|
|
84,669 |
Non-Current Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term trade receivable |
|
|
|
|
|
|
|
|
|
|
8 |
|
|
|
42,192 |
|
|
29,911 |
Exploration and evaluation assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,564 |
|
|
5,564 |
Property, plant and equipment |
|
|
|
|
|
|
|
|
|
|
9 |
|
|
|
87,600 |
|
|
90,832 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
135,356 |
|
|
126,307 |
Total Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
216,836 |
|
|
210,976 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade and other payables |
|
|
|
|
|
|
|
|
|
|
10 |
|
|
|
61,681 |
|
|
53,296 |
Bank loan |
|
|
|
|
|
|
|
|
|
|
11 |
|
|
|
- |
|
|
1,659 |
Tax payable |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
739 |
|
|
1,958 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
62,420 |
|
|
56,913 |
Non-Current Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred income taxes |
|
|
|
|
|
|
|
|
|
|
6 |
|
|
|
11,165 |
|
|
12,132 |
Deferred additional profits tax |
|
|
|
|
|
|
|
|
|
|
7 |
|
|
|
21,400 |
|
|
21,679 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32,565 |
|
|
33,811 |
Total Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
94,985 |
|
|
90,724 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital stock |
|
|
|
|
|
|
|
|
|
|
12 |
|
|
|
85,428 |
|
|
85,428 |
Contributed surplus |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,482 |
|
|
6,482 |
Accumulated other comprehensive
loss |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(290) |
|
|
(303) |
Accumulated income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,231 |
|
|
28,645 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
121,851 |
|
|
120,252 |
Total Equity and Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
216,836 |
|
|
210,976 |
See accompanying notes to the condensed consolidated interim
financial statements.
Condensed Consolidated Interim Statement of
Cash Flows (Unaudited)
ORCA EXPLORATION GROUP INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended |
US$'000 |
|
|
|
|
|
|
|
|
NOTE |
|
|
|
31 Mar 2014 |
|
|
31 Mar 2013 |
CASH FLOWS (USED IN)/FROM
OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit after tax |
|
|
|
|
|
|
|
|
|
|
|
|
1,586 |
|
|
2,774 |
Adjustment for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depletion and depreciation |
|
|
|
|
|
|
|
|
9 |
|
|
|
3,715 |
|
|
2,809 |
Provision for doubtful
debt |
|
|
|
|
|
|
|
|
5 |
|
|
|
2,571 |
|
|
- |
Stock-based compensation |
|
|
|
|
|
|
|
|
|
|
|
|
277 |
|
|
(271) |
Deferred income taxes |
|
|
|
|
|
|
|
|
6 |
|
|
|
(967) |
|
|
(582) |
Deferred additional profits
tax |
|
|
|
|
|
|
|
|
4,7 |
|
|
|
(279) |
|
|
3,035 |
Interest expense |
|
|
|
|
|
|
|
|
5 |
|
|
|
24 |
|
|
205 |
Unrealised loss on foreign
exchange |
|
|
|
|
|
|
|
|
|
|
|
|
177 |
|
|
934 |
Funds flow from operating activities |
|
|
|
|
|
|
|
|
|
|
|
|
7,104 |
|
|
8,904 |
Increase in trade and other receivables |
|
|
|
|
|
|
|
|
|
|
|
|
(624) |
|
|
(20,928) |
Decrease in tax receivable |
|
|
|
|
|
|
|
|
|
|
|
|
221 |
|
|
320 |
(Increase)/decrease in prepayments |
|
|
|
|
|
|
|
|
|
|
|
|
(431) |
|
|
38 |
Increase in trade and other payables |
|
|
|
|
|
|
|
|
|
|
|
|
7,890 |
|
|
7,392 |
Increase in tax payable |
|
|
|
|
|
|
|
|
|
|
|
|
(1,219) |
|
|
(1,269) |
Increase in long-term receivable |
|
|
|
|
|
|
|
|
|
|
|
|
(12,281) |
|
|
- |
Net cash flows from / (used in) operating
activities |
|
|
|
|
|
|
|
|
|
|
|
|
660 |
|
|
(5,543) |
CASH FLOWS USED IN INVESTING
ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration and evaluation expenditures |
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
|
(2) |
Property, plant and equipment expenditures |
|
|
|
|
|
|
|
|
9 |
|
|
|
(483) |
|
|
(268) |
Net cash used in investing activities |
|
|
|
|
|
|
|
|
|
|
|
|
(483) |
|
|
(270) |
CASH FLOWS (USED IN)/FROM
FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank loan proceeds |
|
|
|
|
|
|
|
|
10 |
|
|
|
- |
|
|
4,000 |
Bank loan repayments |
|
|
|
|
|
|
|
|
10 |
|
|
|
(1,659) |
|
|
(785) |
Interest paid |
|
|
|
|
|
|
|
|
5 |
|
|
|
(24) |
|
|
(205) |
Net cash flow from/ (used in) financing
activities |
|
|
|
|
|
|
|
|
|
|
|
|
(1,683) |
|
|
3,010 |
Decrease in cash |
|
|
|
|
|
|
|
|
|
|
|
|
(1,506) |
|
|
(2,803) |
Cash at the beginning of the period |
|
|
|
|
|
|
|
|
|
|
|
|
32,588 |
|
|
16,047 |
Effect of change in foreign
exchange on cash in hand |
|
|
|
|
|
|
|
|
|
|
|
|
(24) |
|
|
177 |
Cash at the end of the period |
|
|
|
|
|
|
|
|
|
|
|
|
31,058 |
|
|
13,421 |
See accompanying notes to the condensed
consolidated interim financial statements.
Condensed Consolidated Interim Statement of
Changes in Shareholders' Equity (Unaudited)
ORCA EXPLORATION GROUP INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US$'000 |
|
|
|
Capital stock |
|
|
Contributed
surplus |
|
|
Cumulative
translation
adjustment |
|
|
Accumulated
income |
|
|
|
Total |
Note |
|
|
|
11 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as at 1 January 2014 |
|
|
|
85,428 |
|
|
6,482 |
|
|
(303) |
|
|
28,645 |
|
|
|
120,252 |
Foreign currency translation adjustment on foreign
operations |
|
|
|
- |
|
|
- |
|
|
13 |
|
|
- |
|
|
|
13 |
Proft after tax for the period |
|
|
|
- |
|
|
- |
|
|
- |
|
|
1,586 |
|
|
|
1,586 |
Balance as at 31 March 2014 |
|
|
|
85,428 |
|
|
6,482 |
|
|
(290) |
|
|
30,231 |
|
|
|
121,851 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US$'000 |
|
|
|
Capital stock |
|
|
Contributed
surplus |
|
|
Cumulative
translation
adjustment |
|
|
Accumulated
income |
|
|
|
Total |
Balance as at 1 January 2013 |
|
|
|
84,983 |
|
|
6,753 |
|
|
89 |
|
|
34,110 |
|
|
|
125,935 |
Foreign currency translation adjustment on foreign
operations |
|
|
|
- |
|
|
- |
|
|
176 |
|
|
- |
|
|
|
176 |
Profit after tax for the period |
|
|
|
- |
|
|
- |
|
|
- |
|
|
2,774 |
|
|
|
2,774 |
Balance as at 31 March 2013 |
|
|
|
84,983 |
|
|
6,753 |
|
|
265 |
|
|
36,884 |
|
|
|
128,885 |
See accompanying notes to the condensed
consolidated interim financial statements.
Orca Exploration Group Inc.
Orca Exploration Group Inc. is an international
public company engaged in natural gas exploration, development and
supply in Tanzania through the
wholly-owned subsidiary PanAfrican Energy Tanzania Limited, as well
as oil and gas appraisal in Italy.
Orca trades on the TSX Venture Exchange under the trading symbols
ORC.B and ORC.A.
The complete unaudited consolidated financial
statements and notes and management's discussion & analysis of
the Company for the quarter ended 31 March
2014 may be found on the Company's website at
www.orcaexploration.com or on the Company's profile on SEDAR at
www.sedar.com.
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 Statements
This press release contains forward-looking
statements. More particularly, this press release contains
statements concerning, but not limited to: repayment of the TANESCO
receivables; the need for additional funding by year end for the
Company's ongoing operations if the Company is unable to collect
the TANESCO receivables; the actions taken and to be taken by the
Company to collect the TANESCO receivables; the Company's viability
and its ability to meet its obligations as they come due; status of
negotiations with the TPDC regarding a sales agreement for
incremental gas volumes and the Company's plans if an agreement is
not reached in the near future; status of execution of a full field
development plan for Songo Songo,
including the anticipated gas sales volumes and the timing of
delivery thereof, the funding of the development plan, and the
contingencies related to the development work; the expected
onstream date for the NNGIP; and the Company's strategic plans.
Although 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, operational, competitive, political and social
uncertainties and contingencies. As a consequence, actual results
may differ materially from those anticipated in the forward looking
statements.
These forward-looking statements involve
substantial known and unknown risks and uncertainties, certain of
which are beyond Orca's control, and many factors could cause
Orca's actual results to differ materially from those expressed or
implied in any forward-looking statements made by Orca, including,
but not limited to: failure to receive payments from TANESCO;
failure to obtain adequate funding to meet the Company's
obligations as they come due; risk that the contingencies related
to the development work for the full field development plan for
Songo Songo are not satisfied; risk
that the expected onstream date for the NNGIP is delayed;
failure to obtain funding for full field development plan for
Songo Songo; risk that the Company
will be required to pay additional taxes and penalties; the impact
of general economic conditions in the areas in which Orca operates;
civil unrest; industry conditions; changes in laws and regulations
including the adoption of new environmental laws and regulations
and changes in how they are interpreted and enforced; increased
competition; the lack of availability of qualified personnel or
management; fluctuations in commodity prices; foreign exchange 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; imprecision in reserve
estimates; the production and growth potential of the Company's
assets; obtaining required approvals of regulatory authorities;
risks associated with negotiating with foreign governments;
inability to access sufficient capital; failure to successfully
negotiate agreements; and risk that the Company will not be able to
fulfill its obligations. In addition there are risks and
uncertainties associated with oil and gas operations, therefore
Orca's actual results, performance or achievement could differ
materially from those expressed in, or implied by, these
forward-looking estimates and, accordingly, no assurances can be
given that any of the events anticipated by the forward-looking
estimates will transpire or occur, or if any of them do so, what
benefits that Orca will derive therefrom. Readers are cautioned
that the foregoing list of factors is not exhaustive.
Such forward-looking statements are based on
certain assumptions made by Orca in light of its experience and
perception of historical trends, current conditions and expected
future developments, as well as other factors Orca believes are
appropriate in the circumstances, including, but are not limited
to: that the Company will have sufficient cash flow, debt or equity
sources or other financial resources required to fund its capital
and operating expenditures and requirements as needed; that the
Company will have adequate funding to continue operations;
that the Company will successfully negotiate agreements; receipt of
required regulatory approvals; the ability of Orca to add
production at a consistent rate; infrastructure capacity; commodity
prices will not deteriorate significantly; the ability of Orca to
obtain equipment in a timely manner to carry out exploration,
development and exploitation activities; future capital
expenditures; availability of skilled labour; timing and amount of
capital expenditures; uninterrupted access to infrastructure; the
impact of increasing competition; conditions in general economic
and financial markets; effects of regulation by governmental
agencies; that the Company will obtain funding for full field
development plan for Songo Songo;
current or, where applicable, proposed industry conditions, laws
and regulations will continue in effect or as anticipated as
described herein; and other matters.
The forward-looking statements contained in
this press release are made as of the date hereof and Orca
undertakes no obligation to update publicly or revise any
forward-looking statements or information, whether as a result of
new information, future events or otherwise, unless so required by
applicable securities laws.
SOURCE Orca Exploration Group Inc.