CALGARY, ALBERTA–(Marketwired – April 7, 2015) – Bonterra Energy Corp. (www.bonterraenergy.com) (TSX:BNE) (“Bonterra” or “the Company”) is pleased to announce today that following its annual banking review, certain amendments to the existing credit agreement dated April 29, 2009 between the Company and its syndicate of lenders (the “Lenders”), have been agreed to.
Based on the terms and conditions set forth in the amended credit agreement, the Lenders have agreed to the following:
- Approval of a borrowing base of CDN $500 million and an increase to the existing credit facility commitment to CDN $425 million from CDN $250 million, subject to closing of the previously announced Pembina area asset acquisition;
- Ability for the Company to request an increase in the commitment amount up to the borrowing base prior to the next scheduled review, subject to the approval of the Lenders; and
- Amending the setting of the borrowing base to occur on a semi-annual basis on or before April 30 and October 31 of each year.
Amounts borrowed under the credit facility bear interest at a floating rate based on the Canadian prime rate or Banker’s Acceptance rate plus a range of 0.75 percent to 3.50 percent. The percent increase within the range is dependent on the type of borrowing and the Company’s consolidated total funded debt to consolidated cash flow. The terms of the revolving credit facility provide that the loan is revolving from April 30, 2015 to April 29, 2016, with a maturity date of April 30, 2017. The revolving credit facility has no fixed terms of repayment.
The material covenants on the credit facility are as follows:
- The Company’s consolidated debt (including working capital, but excluding amounts due to related party and subordinated promissory note) may not exceed CDN $425 million; and
- Dividends paid in the current quarter shall not exceed 80 percent of the average available cash flow for the preceding four fiscal quarters.
This credit facility increase will allow Bonterra to continue the development of its high-quality, Cardium-focused asset base, including the Pembina area asset acquisition and potential further acquisitions.
Certain statements contained in this release include statements which contain words such as “anticipate”, “could”, “should”, “expect”, “seek”, “may”, “intend”, “likely”, “will”, “believe” and similar expressions, relating to matters that are not historical facts, and such statements of our beliefs, intentions and expectations about development, results and events which will or may occur in the future, constitute “forward-looking information” within the meaning of applicable Canadian securities legislation and are based on certain assumptions and analysis made by us derived from our experience and perceptions. Forward-looking information in this release includes, but is not limited to: the closing of the Pembina area asset acquisition and the timing thereof; any increase in the commitment amount up to the borrowing base; potential or unanticipated amendments to the borrowing base; the ability of the Company to repay the credit facility; the Company’s consolidated net debt remaining below CDN $425 million; expected cash provided by continuing operations; cash dividends; future capital expenditures, including the amount and nature thereof; oil and natural gas prices and demand; expansion and other development trends of the oil and gas industry; business strategy and outlook; expansion and growth of our business and operations; and maintenance of existing customer, supplier and partner relationships; supply channels; accounting policies; credit risks; and other such matters.
All such forward-looking information is based on certain assumptions or analyses made by us in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate in the circumstances. The risks, uncertainties, and assumptions are difficult to predict and may affect operations, and may include, without limitation: foreign exchange fluctuations; equipment and labour shortages and inflationary costs; general economic conditions; industry conditions; changes in applicable environmental, taxation and other laws and regulations as well as how such laws and regulations are interpreted and enforced; the ability of oil and natural gas companies to raise capital; the effect of weather conditions on operations and facilities; the existence of operating risks; volatility of oil and natural gas prices; oil and gas product supply and demand; risks inherent in the ability to generate sufficient cash flow from operations to meet current and future obligations; increased competition; stock market volatility; opportunities available to or pursued by us; and other factors, many of which are beyond our control.
Actual results, performance or achievements could differ materially from those expressed in, or implied by, this forward-looking information and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking information will transpire or occur, or if any of them do, what benefits will be derived there from. Except as required by law, Bonterra disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.
The forward-looking information contained herein is expressly qualified by this cautionary statement.
The TSX does not accept responsibility for the accuracy of this release.
George F. Fink, Chairman and CEO
Robb D. Thompson, CFO and Secretary
Telephone: (403) 262-5307
Fax: (403) 265-7488