Orca Exploration updates Swala transaction

DAILY NEWS Reporter

ORCA Exploration Group has indefinitely extended the timing for the closing sale of its subsidiary to Swala Oil and Gas (Tanzania).

Orca wants to offload its stake in PanAfrican Energy Corporation to Swala Tanzania at a value of 130 million US dollars. The firm said in a release that it still retains the right to terminate the extension at any time.

“The extension pertains to tranche 2 and tranche 3 and does not impact tranche 1 which closed on January 16,” Orca said in a release: “The decision was taken in consideration of the uncertainty in the timing of regulatory approval of Swala’s prospectus and listing application in Mauritius”.

Orca's decision not to set a specific date to complete the 2nd and 3rd tranches does not terminate the Swala Investment and Orca support to Swala’s efforts in closing its financing.

However, when Orca said it has provided indefinitely extension, Swala issued a release saying it won’t extend the period as it is beyond its powers.

Swala CEO Dr David Mestres Ridge said the decision was taken in consideration of the uncertainty in the timing of the regulatory approval of prospectus and listing application in Mauritius.

“Swala and Orca will continue to complete the process started earlier this year, but do not believe that either company is served well by agreeing to timelines that are outside of their control,” Dr Mestres said through a release.

He said the process in Mauritius is advancing at creditable speed but oil and gas is a new investment area and the regulator has spent time thoroughly understanding the Swala prospectus.

“Our understanding is that the prospectus will be reviewed by the executive committee of the SEM (Stock Exchange of Mauritius)this coming week and are already engaging with Tanzanian and overseas investors in anticipation of an early closing,” Dr Mestres said.

The decision not to extend the deadline does not terminate the Swala Investment and Orca continues to support Swala efforts in closing its financing.

However, Orca may terminate the balance of the Swala Investment at any time. According to its website, Swala has also become a shareholder of PanAfrican Energy Corporation, a Mauritiusregistered company that owns PanAfrican Energy Tanzania Limited (PAET).

Orca is an international public company engaged in natural gas exploration, development and supply in Tanzania through its subsidiary PAET.