Oil and gas producer Salamander Energy has signed two new borrowing facilities together totalling 350m dollars.
The facilities are designed to extend the maturity of the group's financing, simplify Salamander's borrowing structure and lower its cost of debt.
The new financing arrangement comprises a $300m seven-year Senior Reserve Based Lending facility, secured against expected cash flow from the group's producing assets and a $50m two-year facility, which will be used to debt fund the development of the group's Kerendan gas field.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
As development of the Kerendan field proceeds, Salamander said it is envisaged that the shorter-term borrowings will be folded into the new Reserve Based Lending facility, which will then expand to $350m.
Salamander's existing $325m borrowing base facility - comprising $250m Senior and $75m Junior- will be cancelled when the new facilities come into effect.
Jonathan Copus, Chief Financial Officer of Salamander, commented: "We are pleased that with the continued support of our relationship banks we have been able to enter into new, increased and more flexible debt facilities.
"These new facilities simplify the group's borrowing structure and extend the maturity of its debt. They also improve the efficiency of Salamander's balance sheet by more fully recognising the significant organic reserve growth that has been delivered across the group in the past 12 months."
MF
-
Dividends: Reliability in uncertain timesDividends have formed over half of the total return of the UK market over the last 20 years. Dividend strategies have been under-appreciated while investors have focused on US mega cap technology. Income strategies may have more appeal in a tougher investment climate
-
Trump’s tariffs: what is he thinking and how should UK respond?Every right-thinking person knows that free trade is a surer route to the wealth of nations than protectionism, says Stuart Watkins. What is Trump thinking?
