Ocean Rig Signs Commitment Letter with PanCanadian
Ocean Rig ASA signed a Term Sheet and Commitment Letter with PanCanadian Petroleum Limited, a wholly-owned subsidiary of PanCanadian Energy Corporation, regarding a short-term revolving credit facility totaling US $20 million. The facility will mature upon the delivery of the Company's second rig, Eirik Raude, under the drilling contract with PanCanadian. The loan will be secured with a mortgage in the Company's fourth baredeck.
The first US $10 million tranche of the loan carries an interest rate of LIBOR + 3%. Any amount over USD 10 million drawn under the facility will have an interest rate of LIBOR + 7% and will be available when Eirik Raude is mechanically completed provided that the Company has sold its fourth baredeck and met certain other conditions.
As previously disclosed, the Company's underwriting syndicate regarding the current equity offering was conditional upon execution of this Commitment Letter. The Company will seek approval for the private placement and subsequent issue at the extraordinary general meeting to be held on November 21.