Oil & Gas

Swala Oil & Gas (Tanzania) Plc, currently under liquidation, has filed a claim worth $167 million (approximately Sh450 billion) against the Orca Group for alleging breach of contract and conspiracy to defraud. The suit, filed in the Commercial Division of the High Court by Swala’s liquidator, Mr. Daniel Welwel of Asyla Attorneys, names Orca Energy Group Inc (Orca), PAE Panafrican Energy Corporation (PAEM), and PanAfrican Energy Tanzania Limited (PAET) as defendants. This legal action stems from complex agreements linked to Swala’s operations and investments within the energy sector.

The claim centers on a 2015–2017 agreement that led to the creation of Swala’s wholly owned subsidiary, Swala (PAEM) Limited, which acquired a 7.933 percent stake in PAEM. This subsidiary also signed a shareholders’ agreement with Orca and PAEM. Swala alleges that the Orca Group repeatedly breached its contractual obligations and conspired to defraud Swala by misusing funds and assets from PAET exclusively for their own benefit, significantly harming Swala’s rightful interests. The liquidator stated that Orca and its affiliates acted “to the exclusive benefit of Orca, PAEM and PAET that would otherwise have been distributed to Swala proportionally.”

Swala claims the Orca Group’s actions directly contributed to its financial collapse, enabling Orca to regain the 7.933 percent interest in PAEM at a discount. The claim also includes the value related to the renewal of the Production Sharing Agreement (PSA) and other contracts governing PAET’s operations on the Songo Songo gas licence. Orca has publicly estimated the gross value of these agreements at $1.2 billion (about Sh3.3 trillion), underlining the significant financial stakes involved in this dispute.

The case is proceeding under Commercial Case No. 11561 of 2025, with pre-trial proceedings scheduled to begin on July 15, 2025. Justice Dr. C.K.K. Morris has ordered that the defendants file their written statements of defence by June 20, 2025, and serve the plaintiff the same day, with Swala expected to reply by June 27, 2025. The legal process now unfolds in the High Court’s Commercial Division as Swala pursues its $167 million claim against the Orca Group.