New Standard taps Credit Suisse for $US3m

New Standard Energy has secured $US3 million ($A3.9 million) from its existing debt facility with Credit Suisse to provide working capital while it continues transaction discussions with unnamed parties.

In a statement today, the West Perth-based oil and gas company said Credit Suisse had agreed to release funds out of New Standard’s $US45 million debt facility so it could finalise an appropriate transaction on the best terms possible.

“Discussions with a number of parties in relation to various alternatives (for the ongoing maintenance and development of New Standard’s asset portfolio) have progressed over the past three months,” New Standard said in a statement.

The company said the discussions included negotiations on a corporate transaction but have not matured to a point to warrant further disclosure.

“New Standard is continuing discussions around several other initiatives including corporate transactions, joint ventures and asset sales or swaps,” it said.

Managing director Phil Thick said the additional debt would allow the board additional time to pursue the available potential options.

“We have made the tough but necessary cuts to staff, costs and overheads. We are assessing potential transactions at a corporate and asset level to secure value for our shareholders in this very tough market,” he said.

“Our views on the prospectively of New Standard’s asset portfolio have not changed, but unfortunately the commercial environment engulfing the oil and gas sector has.”

The company said it was also in the final stages of negotiating an extension for an additional 12 months on one of its largest leases in Texas, which wouldallow it to defer all upcoming lease commitments while securing tenure on the acreage.

New Standard was awarded the original $US45 million facility by Credit Suisse in May last year.

Shares in New Standard were 10 per cent lower to 0.9 cents per share at the close of trade.