SEVERAL buyers are seeking to acquire Orca Exploration Group Inc. which is a holding company of PanAfrican Energy which extracts natural gas at Songo Songo islands in Lindi region.
In a recent statement, Orca said it is in discussion with several third party buyers who have made unsolicited approaches to acquire the company or a significant part of its assets but that no deal has been concluded.
"Orca is issuing this press release in response to speculation regarding a potential sale of the company or a significant transaction," said David Lyons, Chairman and Chief Executive Officer and Robert Wynne, Chief Financial Officer and Director of the British Virgin Islands based company.
The statement further noted that Orca is from time to time approached about financing and participation in its assets and takes every approach seriously, notwithstanding that few such approaches progress past initial responses.
"No agreement has been entered into and accordingly no assurance can be given that these discussions will lead to a binding agreement relating to the sale of the company, significant asset disposal, strategic investment or other type of transaction," the statement added.
Orca intends to make no further announcements or communications regarding these proposals until either an agreement has been reached or discussions are terminated without such an agreement being reached, the company concluded.
Meanwhile, Orca said it remains committed to the growth of its Songo Songo gas production and is continuing with preliminary engineering, negotiation of commercial agreements and arrangement of finance in respect of such development.
"The company has recently received from TANESCO a payment of US$5.96 million against arrears as an allocation of the World Bank Second US$100 million Development Policy Operation.
This is substantially less than that which was represented to the company prior to disbursement," the Canadian listed company pointed out. Together with weekly payments of approximately US$1.8 million, TANESCO currently owes the company US$52.4 million of which US$46.0 million is overdue.
The company continues to pursue the full repayment of arrears from TANESCO under a Notice of Dispute filed on 2 April 2014, according to the statement. In August 2004 the Songo Songo natural gas assets were spun out as a separate company (EastCoast Energy Corporation).
In November 2006 EastCoast Energy shareholders approved a name change to Orca Exploration Group Inc. and trading of the company shares on the Toronto Stock Exchange as Orca Exploration commenced on 4 April 2007. Gas volumes marketed by Orca in Tanzania have increased steadily since the start of production and by 2009 Additional Gas sales had reached 10.4 billion cubic feet (Bcf) a year.