CALGARY, AB--(Marketwired - Nov 2, 2015) - Ithaca Energy Inc. (TSX: IAE) (LSE: IAE)
TSX: IAE; LSE: IAE
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Ithaca Energy Inc.
RBL Redetermination Completed
2 November 2015
Ithaca Energy Inc. (TSX: IAE; LSE: IAE) ("Ithaca" or the "Company") announces that it has successfully completed its planned semi-annual reserves based lending ("RBL") facilities review and continues to maintain in excess of $125 million of funding headroom ahead of planned first hydrocarbons from the Greater Stella Area at the end of the second quarter of 2016.
As anticipated the Company commenced deleveraging the business in the second half of 2015, reflecting the benefit of strong operating cashflow generation, lower capital expenditures and the cash received from sale of the non-core Norwegian business. The reduction in debt has been further accelerated by $66 million from the recently completed equity investment in the Company by Delek Group Ltd.
The Company's net debt has reduced from a peak of over $800 million in the first half of 2015 to under $690 million at 31 October 2015. It is anticipated that net debt at the end of this year will remain broadly unchanged from the current level.
Following the RBL redetermination process the Company's available bank debt capacity is $515 million prior to Stella start-up, reflecting lower future oil price assumptions adopted by the banking syndicate. When combined with its $300 million senior unsecured notes, the business continues to maintain funding headroom in excess of $125 million.
Graham Forbes, Chief Financial Officer, commented:
"We are pleased to have efficiently completed the RBL redetermination process and be able to re-confirm the solid funding headroom of the business. The Company has taken a number of proactive measures over the year to maintain a robust financial position during this period of lower and more volatile oil prices, ensuring it has the financial flexibility to manage downside risks and pursue potential opportunities within our core Greater Stella Area."
The Company has in place two bank debt facilities, maturing September 2018; a senior RBL facility of up to $575 million and a junior RBL facility of up to $75 million. The availability to draw upon the facilities is reviewed by the bank syndicate on a semi-annual basis, with the results of the October 2015 redetermination resulting in debt availability of $515 million. Both facilities are based on conventional oil and gas industry borrowing base financing terms, neither of which have historic financial covenant tests. In addition to the bank debt facilities, the Company has $300 million senior unsecured notes due July 2019.
The banks in the debt syndicate are: BNP Paribas, Scotiabank, Deutsche Bank AG, Lloyds Bank, Royal Bank of Scotland, Barclays Bank PLC, Commonwealth Bank of Australia, Skandinaviska Enskilda Banken AB (publ), Société Générale, NIBC and Wells Fargo.
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About Ithaca Energy
Ithaca Energy Inc. (TSX: IAE; LSE: IAE) is a North Sea oil and gas operator focused on the delivery of lower risk growth through the appraisal and development of UK undeveloped discoveries and the exploitation of its existing UK producing asset portfolio. Ithaca's strategy is centred on generating sustainable long term shareholder value by building a highly profitable 25kboe/d North Sea oil and gas company. For further information please consult the Company's website www.ithacaenergy.com.
Some of the statements and information in this press release are forward-looking. Forward-looking statements and forward-looking information (collectively, "forward-looking statements") are based on the Company's internal expectations, estimates, projections, assumptions and beliefs as at the date of such statements or information, including, among other things, assumptions with respect to production, drilling, construction and maintenance times, well completion times, risks associated with operations, future capital expenditures, continued availability of financing for future capital expenditures, regulatory approval requirements, future acquisitions and dispositions and cash flow. The reader is cautioned that assumptions used in the preparation of such information may prove to be incorrect. When used in this press release, the words and phrases like "anticipate", "continue", "estimate", "expect", "may", "will", "project", "plan", "should", "believe", "could", "target", "in the process of" and similar expressions, and the negatives thereof, whether used in connection with operational activities, Stella first hydrocarbons, budgetary figures, anticipated net debt, available bank debt capacity and funding headroom prior to Stella start-up, drilling plans, production forecasts and potential developments, are intended to identify forward-looking statements. Such statements are not promises or guarantees, and are subject to known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The Company believes that the expectations reflected in those forward-looking statements are reasonable but no assurance can be given that these expectations, or the assumptions underlying these expectations, will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These forward-looking statements speak only as of the date of this press release. Ithaca Energy Inc. expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any forward-looking statement is based except as required by applicable securities laws.
Additional information on these and other factors that could affect Ithaca's operations and financial results are included in the Company's Management's Discussion and Analysis for the quarter ended June 30, 2015, and the Company's Annual Information Form for the year ended December 31, 2014 and in reports which are on file with the Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com).
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