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.

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.