05/06/2018 - 14:07

Australis secures $US75m credit facility

05/06/2018 - 14:07

Bookmark

Upgrade your subscription to use this feature.

Australis Oil & Gas has secured a $US75 million ($98 million) credit facility with Macquarie Bank to fund drilling within the Tuscaloosa Marine Shale in the US.

Australis has interests in the US.

Australis Oil & Gas has secured a $US75 million ($98 million) credit facility with Macquarie Bank to fund drilling within the Tuscaloosa Marine Shale in the US.

Under the agreement, the funding is available in two tranches, comprising $US35 million available immediately, followed by a further $US30 million that is accessible upon satisfactory initial well results.

An additional $US10 million is available within the first tranche if Australia commits to spending $US20 million on the initial drilling program.

The interest rate will be LIBOR plus 6 per cent, with quarterly principal repayments of $US1 million, commencing nine months after the initial draw down.

The company has also issued 30 million option to Macquarie, which includes 20 million at 49 cents each and 10 million at 51 cents each.

Australis can also request an additional $US25 million, subject to further credit approval by Macquarie.

Australis chairman Jon Stewart said the company was pleased to secure the credit facility.

“Our initial aim is to repeat the productivity results achieved by the wells drilled within the core of the TMS in 2014 by Encana, which is the basis of our TMS type curve,” he said.

“Importantly, and consistent with our corporate strategy, we have negotiated the terms of this facility to allow flexibility to take advantage of alternate attractive funding sources as they become available.

“As we progress the development of our TMS assets it is likely that broader funding structures will be added as and when appropriate, to actively manage our risk and support our development plan.

“We expect this program to further demonstrate the significant value of the large oil resource that we hold within the TMS, which is presently independently estimated at 145 million barrels.”

Shares in Australis finished off 4.4 per cent at 44 cents each today.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options