The Company and IFC are now focused on the "A" Loan, the second tranche of the debt package, which will be structured as a reserve-based, borrowing base credit to fund the Company's ongoing development work in the Corvina Field. While anticipated to be approximately $35 million, the final amount will be a function of IFC's evaluation of the Company's proved reserves. The Company expects to close the "A" Loan in Q1 2008. In addition, the Company is continuing its efforts to advance the third tranche, or the "B" Loan, which is senior debt to be syndicated by IFC and is projected to total approximately $115 million. This third tranche, which will be used to fund the Company's gas-to-power project, will expected to close once the syndication is complete.
Manolo Zuniga, President and Chief Executive Officer commented "The closing of this first tranche is the first step toward completing the three-tier debt financing process with IFC. These funds will allow us to continue developing the Corvina oil project while we continue to work diligently on closing the next two tranches. Furthermore, IFC's commitment to upsize the loan package to $165 million is instrumental in strengthening our balance sheet which, coupled with the cash flow from Corvina oil, will enable us to grow the Company without having to access the equity capital market in the near term." IFC to Provide Assistance to Tumbes Region IFC will sign an agreement with government officials in Tumbes under which IFC will provide financial and management training to the region's leaders to help manage economic growth and social programs in the region. The Company is proud to sponsor this program along with IFC. In addition, the Company will continue its own efforts to aid in the development of social programs in the region, such as the Wawa Wasi child development programs and university scholarships.
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