CALGARY, July 3, 2019 /CNW/ – Osum Oil Sands Corp. (“Osum” or the “Company”), a private oil sands company, announced today that it has completed an amendment with lenders to extend the maturity date of 90.6%, or approximately US$172 million, of its existing US$190 million senior secured first lien term loan by two years to July 31, 2022. The interest rate on the extended portion of the loan has been increased and will vary between LIBOR plus 7.5% and 9.5% per annum depending on the Company’s debt to cash flow ratio. The remaining 9.4% of the loan, or approximately US$18 million, will continue to bear interest at LIBOR plus 5.5% per annum and mature as scheduled on July 31, 2020. Barclays acted as sole lead arranger and sole bookrunner for the transaction.
Commenting on the debt extension, Steve Spence, President and CEO of Osum said, “Osum’s ability to extend the term loan on reasonable terms in a challenging market well in advance of the maturity date reflects a strong degree of support from our lenders. Our level of debt is manageable at current commodity prices. However, until there is significant progress on resolving the current egress issues, we will be devoting much of our excess cash flow to reducing debt to ensure that we have the financial capacity to invest in our business when conditions improve.”
Operationally, the Company is pleased to report that Q2 2019 production from its Orion Thermal Project in the Cold Lake oil sands region of Alberta averaged over 19,000 barrels per day, more than doubling production following the completion of the Phase 2BC expansion in Q3 2018. This surpasses the facility’s production target of 18,000 barrels per day and was reached well ahead of the previously stated timeline of September 2019.
Established in Alberta in 2005, Osum Oil Sands Corp. is a private oil sands producer focused on the responsible application of in-situ recovery technologies within Canada’s oil sands and carbonates. Additional information on the company is available at www.osumcorp.com.