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Orca Exploration Faces Financial and Operational Challenges

Orca Exploration Faces Financial and Operational Challenges

Orca Exploration Group Class B ( (ORXGF) ) has released its Q4 earnings. Here is a breakdown of the information Orca Exploration Group Class B presented to its investors.

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Orca Exploration Group Inc., through its subsidiary PanAfrican Energy Tanzania Limited, operates the Songo Songo gas field in Tanzania, focusing on natural gas production and its conversion to electricity, a pioneering effort in East Africa. The company’s recent earnings report highlights a slight increase in revenue to $111.6 million for 2024, despite challenges such as reduced production volumes and commercial uncertainties. However, Orca reported a net loss of $21.6 million, a significant downturn from a net income of $7.0 million in 2023, primarily due to asset impairment and legal disputes. Key financial metrics showed a decrease in working capital and cash flow from operations, alongside a substantial drop in natural gas reserves, attributed to production and technical revisions. Despite operational challenges, including a failed well intervention and disputes over gas agreements, Orca maintained strong operational uptime and continued to engage in strategic negotiations for a license extension. Looking forward, Orca’s management emphasizes the need for a license extension to sustain investment and development of the Songo Songo gas field, aiming to support Tanzania’s growing energy demands while navigating ongoing commercial and regulatory challenges.

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