Lone Pine Resources Inc. provided an update on Nov. 12 regarding its restructuring plan and related court proceedings.
Execution of Commitment Letter for New Borrowing Base Facility
On Nov. 11, Lone Pine entered into a commitment letter with a syndicate of lenders to provide for a new senior secured credit facility to be effective upon completion of the company's proposed restructuring under the companies' creditors arrangement act that was previously announced on Sept. 25. Funding of the new ABL, which remains subject to the negotiation and execution of definitive documentation, is conditional on, among other things, completion of the proposed restructuring as previously announced by the company. It is estimated that the available borrowing base of the new ABL will be $130 million at the time of closing. As part of the proposed restructuring, Lone Pine expects that proceeds from a new US $100 million preferred equity investment to be made by eligible affected creditors, together with a portion of the borrowings available under the new ABL, will be used to repay all secured indebtedness under the company's existing secured credit facility. Lone Pine intends to seek approval of the commitment letter in respect of the new ABL from the Alberta Court of Queen's Bench in its proceedings under the CCAA.
Automatic Extension of Stay Period and Extension of Claims Bar Date
In connection with Lone Pine's execution of a commitment letter for the new ABL, the stay of proceedings against Lone Pine, certain of its affiliates, and its directors and officers under the CCAA that was initially put in place by the Canadian Court on Sept. 25 has been automatically extended to and including Nov. 29.
Lone Pine intends to propose a plan of compromise and arrangement in accordance with the restructuring terms previously announced, which will provide for, among other things, the cancellation of all outstanding shares of the company's common stock, the conversion of US $195 million of 10.375% senior notes plus accrued but unpaid interest into new common shares and a new US $100 million preferred share offering to eligible affected creditors. Lone Pine anticipates filing a proposed plan on or before Nov. 29, unless otherwise extended.
In connection with the CCAA proceedings, on Oct. 9, the Canadian Court approved a claims procedure order and established an initial claims bar date of Nov. 13. On Nov. 8, the Canadian Court granted an order extending the claims bar date from Nov. 13 to Nov. 27.
Lone Pine Resources Inc. is an independent energy company engaged in the exploration and development of natural gas and light oil in Canada. The company is based in Calgary.
Recommended Reading
Biden Administration Criticized for Limits to Arctic Oil, Gas Drilling
2024-04-19 - The Bureau of Land Management is limiting new oil and gas leasing in the Arctic and also shut down a road proposal for industrial mining purposes.
Exclusive: The Politics, Realities and Benefits of Natural Gas
2024-04-19 - Replacing just 5% of coal-fired power plants with U.S. LNG — even at average methane and greenhouse-gas emissions intensity — could reduce energy sector emissions by 30% globally, says Chris Treanor, PAGE Coalition executive director.
Renewed US Sanctions to Complicate Venezuelan Oil Sales, Not Stop Them
2024-04-19 - Venezuela’s oil exports to world markets will not stop, despite reimposed sanctions by Washington, and will likely continue to flow with the help of Iran—as well as China and Russia.
FERC Again Approves TC Energy Pipeline Expansion in Northwest US
2024-04-19 - The Federal Energy Regulatory Commission shot down opposition by environmental groups and states to stay TC Energy’s $75 million project.
US Orders Most Companies to Wind Down Operations in Venezuela by May
2024-04-17 - The U.S. Office of Foreign Assets Control issued a new license related to Venezuela that gives companies until the end of May to wind down operations following a lack of progress on national elections.