UK’s Orca Exploration Group has signed a loan agreement with International Finance Corporation (IFC), a member of the World Bank Group, for a $60 million investment in the company’s operating subsidiary, PanAfrican Energy Tanzania Limited (PAET).
The Loan will fund part of an estimated $120 million first phase of a Songo Songo Main Field development programme currently being undertaken using the Paragon M826 drilling rig. The Off-Shore Programme is designed to put safe existing suspended and operating production wells, restore and increase the current productive capacity of the Songo Songo Main Field to ensure the continued delivery of protected and additional gas into the existing Songas infrastructure.
It will also provide additional operational redundancy and deliverability for future additional gas sales, by way of the workover and recompletion, abandonment or sidetrack drilling of three existing offshore wells, and/or the drilling of additional production gas wells at locations to be determined in the region of the existing offshore wells. depending on the outcome of the workovers.
Since programme commencement, previously suspended production wells SS-5 and SS-9 have been successfully worked over and recompleted, and have been restored to full productive capacity estimated to be approximately 35 MMscfd per well.
The off-shore programme is intended to restore and expand field productive capacity from about 83 million standard cubic feet per day (MMscfd) prior to the programme to about 190 MMscfd on completion of the programme. When completed, the field is expected to be capable of both filling the existing Songas infrastructure to capacity of approximately 102 MMscfd, as well as providing additional gas volumes to the newly commissioned National Natural Gas Infrastructure Project (NNGIP) as and when contracted.
‘The conclusion of the IFC financing is a significant achievement for Orca and an important endorsement of the Company’s continuing commitment to Tanzania,’ commented W. David Lyons, Orca chairman and chief executive officer. ‘It allows us to raise finance and manage risk in the face of a challenging business environment, and to undertake urgently needed development of the Songo Songo field. It further safeguards Songo Songo’s future as an important part of Tanzania’s energy security. The World Bank was instrumental in bringing the Songo Songo gas-to-electricity project to reality some 20 years ago and Orca is pleased to continue this long-term relationship, now directly with IFC, in support of the sustainable development of Tanzania’s energy resources.’
‘The Songo Songo field is Tanzania’s most important source of proven natural gas production, and is the largest supplier of energy to the Dar es Salaam region’ said Lance Crist, IFC global head of natural Resources. ‘Through this investment, IFC is working to help to alleviate electricity shortages in Tanzania, which are an impediment to the country’s continued economic g