Stratic Secures $150M Bank Loan Facilities
Stratic Energy Corporation announces that it has secured new bank loan facilities totaling U.S. $150 million, principally to finance its field development programs.
The new facilities to be provided to certain subsidiaries of Stratic comprise a $110 million senior, secured Borrowing Base facility and a $5 million working capital facility, underwritten by The Royal Bank of Scotland plc (RBS) and Societe Generale Corporate & Investment Banking, as Joint Mandated Lead Arrangers, and an Undeveloped Asset-Backed (UDAB) Facility of $35 million led by RBS, of which $22.5 million is initially underwritten. The Borrowing Base and UDAB facilities have terms of five and three years, respectively. RBS is the Structuring Bank for the facilities, the closing of which is subject to normal loan market terms.
The Borrowing Base facility will be used principally to finance Stratic’s share of capital expenditure on its portfolio of development assets, including the West Don oil field in the UK sector of the North Sea, the P8a Horizon West oil field in the Dutch Sector of the North Sea and the Longanesi gas field in Italy. The UDAB Facility is for funding expenditure on specified pre-development assets. Additional assets can be added to both facilities over time, as projects are advanced. The facilities will also be used to retire existing bank debt.
A field development program (FDP) for the West Don oil field in the UK North Sea was submitted for approval to the UK Government’s Department for Business, Enterprise and Regulatory Reform late in 2007. FDP approval is expected to be received in the first half of 2008. Total capital costs of the West Don project are expected to be about GBP 170 million (gross) (Stratic share 17.25%). The field development plans for the Horizon West oil field in block P8a of the Dutch sector of the North Sea and the Longanesi gas field in Italy are progressing satisfactorily and are expected to be approved by the partners during the spring of this year.
“These debt facilities will permit efficient financing of the development expenditure on our key projects,” Peter Thomas, Stratic’s chief financial officer, commented. “We are delighted to have secured an underwritten financing package on excellent terms during a turbulent period in credit markets. The facilities will provide the flexibility we need for funding our asset portfolio as it evolves, including development and pre-development assets.”
- EnQuest Commences Drilling at West Don Field (Aug 09)
- EnQuest Increases Reserves in North Sea with Stratic Acquisition (Aug 03)
- Stratic Highlights 1Q10 Financial, Operational Results (May 28)