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Nigeria: Eland Oil & Gas announces new accordion facility and increased borrowing base
14 Mar 2019
AIM-listed Eland Oil & Gas, an oil & gas production and development company operating in West Africa with an initial focus on Nigeria, has announced a new accordion facility and increased borrowing base.
In November 2018, the Company announced that it had successfully refinanced its existing reserve-based lending facility (the 'RBL Facility') with a new 5-year syndicated RBL facility in an amount of US$75 million, with the option to increase it to up to $200m via an accordion, subject to incremental production and reserves.
The Company has announced that following a redetermination, the borrowing base amount has increased from $103 million to $134 million and an initial accordion increase of $50 million is being underwritten by The Standard Bank of South Africa Limited and Stanbic IBTC Bank PLC, resulting in the commitments under the facility increasing from $75 million to $125 million. Of the commitments, $50 million is currently drawn.
Standard Advisory London Limited and Stanbic IBTC Capital Limited (as Bookrunners) have been mandated to manage the primary syndication of the initial accordion increase. Principal repayments will commence Q4 2019 (consistent with the statement in the November RNS that there is a one-year grace period on principal repayments from execution of the facility which occurred in November 2018).
Ron Bain, CFO, commented:
'I am pleased to announce the large increase in borrowing base on our RBL facility which demonstrates the hugely accretive quality of the new wells drilled on the OML 40 asset and the growth in value they bring to our shareholders. Since refinancing the RBL in 2018 into a longer-term facility we have the flexibility to diversify the capital structure of the company leveraging our position comfortably within our debt parameters and lowering the overall cost of capital.'
Source: Eland Oil & Gas