Finance - Debt
The MLP maneuvers itself into $500 million liquidity by revising its borrowing base and cutting unit distributions by $0.50 to save $50 million annually.
In a Canadian court filing, a former U.S. bankruptcy judge said bondholders rightfully demanded repayment from Connacher Oil & Gas Ltd., which defaulted on a $128 million loan, Bloomberg said.
The fully drawn $1 billion revolving credit line, drawn March 15, could be cut due to low oil prices, Reuters said. Sabine had about $327 million in cash on hand.
Breitburn Energy Partners LP will sell $350 million perpetual convertible preferred units and $650 million senior secured notes to investment funds managed by EIG Global Energy Partners, and other purchasers.
Net proceeds from the private placement of senior notes, along with revolving credit facility borrowings, will buy back notes due 2020 and 2021. Tender offers for them began March 9.
Net proceeds from the private placement of senior notes are expected to total about $389.3 million, and they will support capex and other general corporate purposes.
Net proceeds are expected to total $793.8 million. They will repay outstanding commercial paper program amounts and support general partnership purposes.
After spending more than $5 billion in the Marcellus and buying assets from Statoil and WPX, the company plans to divest up to $800 million to overcome a cash flow gap.
The loan was used to repay $150 million of borrowings. The remainder of the loan will support funds for general corporate purposes.
With acreage the Barnett Shale, Delaware Basin and Horn River Basin, the company wants to reorganize and is continuing to pay vendors, maintain payroll.
Sabine said March 16 that it is considering “strategic alternatives” to its capital structure following legal action by bondholders seeking $584 million. The company has been served a notice of default by its lender.
U.S. Treasuries and other global financial assets benefited from the last decade’s rising oil prices; now, exporters use them to hedge the drop in their oil income, Reuters said.