On May 29, Orca Exploration Group Inc., BVI-registered natural gas exploration and development company, announced its financial results for the quarter ended 31 March 2008. Financial results for the whole period of the year 2007 were published in the end of April.
Current results for this year are: 38% increase in revenue to US$5.3 million (compared to US$3.8 million in the first quarter of the last year), profit before taxation – US$0.3 million (US$0.4 million in Q1 2007). There is also a 100% increase in the net cash flow from operations before working capital changes to US$2.4 million (US$1.2mln in Q1 2007).
In the report, it was noted by President and CEO of the BVI company that, during the first period of the year 2008, Orca Exploration increased gas sales to both the power sector and to industrial customers compared with Q1 2007. Additional Gas Sales to the power sector were up 46%, and industrial gas sales were up 7% over the same period of 2007.
Orca Exploration is also continuing the exploration of new gas reserves in Tanzania, to meet the growing demand for gas by the power sector, and evaluating a number of high potential oil exploration and development opportunities in West Africa.
During all the first quarter of the year, Orca Exploration was engaged in intensive negotiations with the Tanzanian electric power utility, Songas Limited, and the Ministry of Energy and Minerals to secure two long term contracts for the supply for power generation. The negotiations have proceeded well, and contracts are expected to be signed at the beginning of Q3 2008.
Orca’s operations in Q1 2008 generated funds from operations before working capital changes of US$2.4 million – an increase of 100% on Q1 2007. As gas sales increase and marketing costs decrease, this will probably grow in the second half of 2008. The BVI company currently has cash of approximately US$13 mln, and is in the process of arranging a US$5 mln short term overdraft.
During the year 2008, Orca’s management will focus on monetising company’s additional gas reserves through the expansion of sales within the growing Tanzanian natural gas market whilst planning to add reserves in 2009.