Spring Energy Secures Exploration Loan Facility for NCS Activities
Spring Energy has secured a NOK 1 000 million exploration loan facility with a banking group comprising Merchant Banking, Skandinaviska Enskilda Banken AB ("SEB"), DnB NOR ("DNB") and BNP Paribas ("BNPP").
Under the Norwegian tax regime, exploration focused companies recover 78% of exploration and appraisal related expenditure in December the following year. The credit facility provides pre-funding of approximately 75 percent of the Company's exploration, appraisal and supporting expenditure, thereby quadrupling the capital available for investment in exploration and appraisal activities.
This facility further strengthens Spring Energy's financial position and will allow Spring Energy to increase its exploration and appraisal activities on the NCS and take advantage of attractive opportunities available in the transaction market. Establishing banking relationships with such a strong group of energy focused banks, is also an important step in Spring Energy's future development towards becoming a fully integrated E&P company.
SEB has acted as the Agent and Co-ordinating Mandated Lead Arranger on the NOK 1 000 million Revolving Exploration Facility, which was substantially oversubscribed by the banks.
The exploration loan facility together with the equity finance commitment of US $120 million from HitecVision, enables Spring Energy to pursue an ambitious exploration and appraisal driven growth strategy over the next couple of years.
The facility is conditioned upon a final Loan Agreement between the parties.