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TORTOLA, British Virgin Islands, Aug. 12, 2026 (GLOBE NEWSWIRE) — Orca Energy Group Inc. (“Orca” or the “Company” and includes its subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) today announces that it has filed its condensed consolidated interim (unaudited) financial statements and management’s discussion and analysis for the three and six month periods ended June 30, 2026 (“Q2 2026”) with the Canadian securities regulatory authorities. All amounts are in United States dollars (“$”) unless otherwise stated.
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- Revenue decreased by 2%, or $0.6 million, for Q2 2026 and increased by 5%, or $2.4 million, for the six months ended June 30, 2026 over the comparable prior year periods. The decrease for Q2 2026 over the comparable prior year period is primarily a result of the decrease in the current income tax adjustment. The increase for the six months ended June 30, 2026 is primarily a result of higher gas deliveries to the industrial sector.
- Additional Gas volumes decreased by 3% for Q2 2026 and increased by 4% for the six months ended June 30, 2026 compared to the same prior year periods. The decrease for Q2 2026 over the comparable prior year period was mainly driven by lower consumption by the Tanzanian Electric Supply Company Limited (“TANESCO”). The increase for the six months ended June 30, 2026 over the comparable prior year period was mainly a result of increased consumption by industrial customers.
- On August 7, 2024, PanAfrican Energy Tanzania Limited (“PAET”) and Pan African Energy Corporation (Mauritius) (“PAEM”) issued a notice of dispute (the “Notice of Dispute”) in respect of an investment treaty claim against the Government of Tanzania (the “GoT”) for breach of the Agreement on Promotion and Reciprocal Protection of Investment between the Government of the Republic of Mauritius and the GoT (the “BIT”), and a contractual dispute against the GoT and the Tanzanian Petroleum Development Corporation (“TPDC”), for breaches of the: (i) the Production Sharing Agreement among PAET, TPDC and the GoT (the “PSA”), and (ii) the Gas Agreement among the GoT, TPDC, Songas Limited (“Songas”), and PAET (the “Gas Agreement”), for damages estimated in excess of $1.2 billion. Initial meetings with both the Advisory and Coordinating Committees were held during the week of October 14, 2024, without any resolution on the key issues in dispute. Following a period of negotiations with the GoT, on August 1, 2025, PAET issued two sets of arbitration proceedings against the GoT and TPDC registered with the International Centre for Settlement of Investment Disputes (“ICSID”) for breach of the PSA and Gas Agreement respectively and PAEM issued arbitration proceedings against the GoT for breach of the BIT (the “RFAs”). The claims under the RFAs arise out of a series of actions and omissions by Tanzania and TPDC that threaten the viability of the Project and breach multiple obligations under the BIT, PSA and Gas Agreement. On August 28, 2025, ICSID registered all three RFAs. The proceedings under the Gas Agreement and PSA were consolidated by agreement of the parties on December 17, 2025. On February 11, 2026, the arbitral tribunal in the Gas Agreement and the PSA arbitration was constituted, and on February 13, 2026, the arbitral tribunal in the BIT arbitration was constituted. The tribunals held the first procedural hearings in the proceedings under the BIT on April 27, 2026, and in the consolidated proceedings under the Gas Agreement and the PSA on May 7, 2026, following which the procedural timetables were issued in June 2026 and final hearings to be scheduled in 2029 and 2030. PAET and PAEM are due to file their Memorials in both proceedings on October 30, 2026.
- Net loss attributable to shareholders amounted to $2.6 million for Q2 2026 and net income attributable to shareholders amounted to $0.8 million for the six months ended June 30, 2026, as compared to net income attributable to shareholders of $22.4 million for three months ended June 30, 2025 (“Q2 2025”) and $22.5 million for the six months ended June 30, 2025. The decreases compared to the same prior year periods were primarily a result of the reversal of loss allowance in Q2 2025 following the collection of TANESCO long-term arrears pursuant to the settlement agreement.
- Net cash flows from operating activities decreased by 97%, or $31.0 million, for Q2 2026 and by 100%, or $52.2 million, for the six months ended June 30, 2026 compared to the same prior year periods primarily as a result of the final settlement in the 3D seismic acquisition program dispute and the Company’s retention bonus payment to its local workforce in Q2 2026.
- Capital expenditures decreased by $0.6 million for the six months ended June 30, 2026 compared to the same prior year period. The capital expenditures in Q1 and Q2 2026 and Q1 and Q2 2025 primarily related to the costs of flowlines replacements on SS-5 and SS-9 wells, deferred from 2024 at the request of the GoT. Capital expenditures for Q1 and Q2 2026 are presented net of credits received from a supplier previously involved in the workover program.
- The Company exited Q2 2026 with $10.4 million in working capital (December 31, 2025: $27.4 million) and cash and cash equivalents of $79.0 million (December 31, 2025: $87.0 million). Cash held in hard currencies (USD, Euro, GBP, CDN) as at June 30, 2026 was $71.7 million (December 31, 2025: $82.8 million). As of December 31, 2025, $24.7 million was posted as security in respect to an appeal initiated by the Company relating to a judgment received from the Tanzania High Court (Commercial Division) for a claim brought by a contractor against PAET relating to alleged losses arising from PAET’s termination of a contract relating to the Company’s 3D seismic acquisition program. On May 11, 2026, $19.3 million was paid in full and final settlement and the restrictions lifted on the remaining security balance of $5.4 million.
- On February 27, 2026, the Company entered into an agreement with Swala Oil and Gas (Tanzania) plc (in liquidation) (“Swala”) for the withdrawal without leave to refile of Swala’s proceedings against Orca, PAEM, and PAET (collectively, the “Orca Group”) before the High Court of Tanzania in Case No. 11561 of 2025 (the “Tanzanian Proceedings”), and the withdrawal of the anti-suit injunction filed by the Orca Group against Swala in the High Court of England and Wales Commercial Court. The Orca Group and Swala agreed to refer any such dispute to a confidential arbitration conducted under the Arbitration Rules of the London Court of International Arbitration, with London as the place and seat of such arbitration.
- On April 10, 2026 the Orca Group filed a Request for Arbitration under the LCIA Arbitration Rules (2020) pursuant to Clause 2.6 of the Settlement Deed executed on February 26, 2026 by Orca, PAEM, PAET and Swala seeking, declaratory and monetary reliefs against Swala and a new entity to which Swala assigned its claims. Specifically, the Claimants seek declarations that the claims advanced by Swala in the Tanzanian Proceedings and assigned to the new Swala entity have no legal or factual basis and must fail. Instead, those claims are wholly speculative and vexatious and have been manufactured in an attempt to circumvent the comprehensive release contained in the related share sale agreement.
- On June 25, 2026, Swala and Swala UK Operations Limited (“Swala UK”) filed an LCIA arbitration against Orca, PAEM and PAET, claiming damages of US$164 million (the “Second Arbitration”). At the same time, they requested that the proceedings be consolidated, with Swala and Swala UK designated as the claimants and Orca, PAEM and PAET as the respondents. On July 2, 2026, Orca, PAEM and PAET filed an application with the tribunal in the First Arbitration seeking consolidation of the two proceedings while maintaining the parties’ designations in the First Arbitration (i.e., the Orca Group as claimants and the Swala parties as respondents). On July 21, 2026, the Tribunal ruled in favour of Orca Groups’ application for consolidation.
- On April 13, 2026, Orca announced that it had entered into a definitive Share Purchase Agreement (the “Share Purchase Agreement”) with Taifa Gas Tanzania Limited (“Taifa”) and Amber Energy Investment L.L.C-FZ (“Amber”, and together with Taifa, the “Purchasers”) pursuant to which Orca will sell all of the outstanding shares of PAEM (the “Transaction”). Upon closing of the Transaction, Taifa will acquire 49% of PAEM and Amber will acquire 51%. The Share Purchase Agreement provides for a nominal cash price of US$10.00 for the PAEM shares, which is in addition to the other covenants, warranties, representations and obligations of the Purchasers under the agreement and the strategic and commercial benefits that would accrue to Orca by exiting its Tanzanian business. Closing of the Transaction is subject to customary and transaction-specific conditions, including approval or clearance from the Tanzania Fair Competition Commission and the Tanzanian Minister responsible for petroleum affairs, approval by a simple majority of the votes cast by Orca shareholders at the Company’s annual general and special meeting of shareholders (which was received on June 17, 2026), acceptance by the TSX Venture Exchange (the “TSXV”) of the Transaction and related matters requiring the TSXV’s approval or acceptance, and the release of Orca from remaining guarantees and related undertakings in favor of the IFC in respect of obligations of PAEM and PAET. Any party may terminate the Share Purchase Agreement for any reason.
- On May 27, 2026, the Company declared a dividend of CDN$0.10 per share on each of its Class A Shares and Class B Shares to holders of record as of June 30, 2026. The dividend was paid on July 15, 2026.
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Financial and Operating Highlights for the Three and Six Months Ended June 30, 2026
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| Three months ended June 30 | % Change | Six months ended June 30 | % Change | ||||
| (Expressed in $’000 unless indicated otherwise) | 2026 | 2025 | Q2/26 vs Q2/25 | 2026 | 2025 | Ytd/26 vs Ytd/25 | |
| OPERATING | |||||||
| Daily average gas delivered and sold(MMcfd) | 66.4 | 68.3 | (3)% | 73.0 | 70.2 | 4% | |
| Industrial | 21.8 | 18.5 | 18% | 21.4 | 18.9 | 13% | |
| Power | 44.6 | 49.8 | (10)% | 51.6 | 51.3 | 1% | |
| Average price($/mcf) | |||||||
| Industrial | 7.71 | 7.82 | (1)% | 7.79 | 7.90 | (1)% | |
| Power | 3.95 | 4.03 | (2)% | 3.99 | 3.97 | 1% | |
| Weighted average | 5.19 | 5.06 | 3% | 5.10 | 5.03 | 1% | |
| Operating netback($/mcf)1 | 2.86 | 2.67 | 7% | 2.75 | 2.78 | (1)% | |
FINANCIAL | |||||||
| Revenue | 23,690 | 24,274 | (2)% | 52,087 | 49,665 | 5% | |
| Net (loss) / income attributable to shareholders | (2,634) | 22,401 | n/m | 834 | 22,503 | (96)% | |
| per share – basic and diluted($) | (0.13) | 1.13 | n/m | 0.04 | 1.14 | (96)% | |
| Net cash flows from operating activities | 917 | 31,948 | (97)% | 11 | 52,212 | (100)% | |
| per share – basic and diluted($)1 | 0.05 | 1.62 | (97)% | 0.00 | 2.64 | (100)% | |
| Capital expenditures1 | 1 | 44 | n/m | (5) | 592 | n/m | |
| Weighted average Class A and Class B Shares1(‘000) | 19,765 | 19,765 | 0% | 19,765 | 19,766 | 0% | |
June 30, | As at December 31, | ||||||
| 2026 | 2025 | % Change | |||||
| Working capital (including cash)1 | 10,444 | 27,411 | (62)% | ||||
| Cash and cash equivalents | 78,962 | 86,986 | (9)% | ||||
| Outstanding shares(‘000) | |||||||
| Class A | 1,750 | 1,750 | 0% | ||||
| Class B | 18,015 | 18,015 | 0% | ||||
| Total shares outstanding | 19,765 | 19,765 | 0% | ||||
| 1 Please refer to the Non-GAAP Financial Measures and Ratios section of the MD&A for additional information. | |||||||
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