TANZANIA Petroleum Development Corporation (TPDC) has put on halt the transfer of shares by PanAfrican Energy Corporation to Swala Oil and Gas (Tanzania), until the government gets full information regarding the transaction.
Orca is an international public company engaged in natural gas exploration, development and supply in Tanzania through its wholly-owned subsidiary, PanAfrican Energy Tanzania Limited.
On February 2, 2018, Swala entered an agreement with Orca Exploration Group Inc to acquire up to 40 per cent of Orca’s wholly-owned Mauritius subsidiary, PanAfrican Energy Corporation for a total consideration of up to 130 million US dollars. Swala - the first oil and gas exploration company to be listed on the Dar es Salaam Stock Exchange - agreed to acquire the firm through its subsidiary Swala (PAEM) Limited (SPL).
PanAfrican Energy Corporation is the parent company of PanAfrican Energy Tanzania Limited (PAET), which produces and sells natural gas from the Songo Songo block.
In a quick rejoinder, TPDC Acting Managing Director, Engineer Kapuulya Musomba, said the transaction by Swala was likely to touch the interests of PanAfrican Energy Tanzania Limited, a company undertaking petroleum activities in Tanzania.
In a press release published yesterday in various newspapers, the TPDC boss maintained that following a press release by Swala, the national oil company wrote to the latter requesting them to halt the transaction, pending the government and its institutions to satisfy themselves that the deal will have no effect on the Production Sharing Agreement (PSA) signed between the government, TPDC and Pan African Energy.
According to an agreement between Swala and Orca, if the issuance of Preferred Shares is not approved by TPDC, then Swala PAEM Limited (SPL) shall pay Orca the equivalent amount in cash.
TPDC has exclusive rights provided for in the Petroleum Act No 21 of 2015 to undertake the upstream, midstream and downstream operations. It is mandated to supervise international oil companies to ensure they undertake their operations in accordance with the laws and it protects the national interest on behalf of the government.
“All companies in the transfer process should put the transaction on hold pending the government and its institutions to have full information regarding the deal and the public will be notified after the state satisfies itself on the agreement,’’ said Eng Musomba.
In a telephone interview with the ‘Daily News on Saturday’ yesterday, Eng Musomba said before any transfer of shares, TPDC ought to first satisfy itself if all the important legal requirements are met before granting an approval.
“There are several issues that we look at including all the statutory tax obligations and the trust that the companies have in the country and in an event we deny them approval of transaction, that means the legal requirements are not properly met.
Contacted yesterday, one of the Swala administrators who preferred anonymity because she is not the spokesperson of the company, said she was yet to see the TPDC press release.
“Our CEO might have received a letter from TPDC and he is the only spokesperson of the company, but unfortunately he is out of the country and at the moment he cannot be reached on his mobile phone,’’ she said
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