Penn West Petroleum Ltd. (TO: PWT.TO) said that it renewed its unsecured revolving bank facility on May 6.

The borrowing capacity was lowered to $1.7 billion, down from $3 billion, the company added. The long-term plan’s requirement of less credit capacity drove the reduction, Penn West noted.

The facility has two tranches, one scheduled to mature May 6, 2019 and the other on June 30, 2016, the company said. The second tranche provided a $500 million borrowing limit, Penn West noted. It should be canceled after the company completes an asset disposition strategy under the long-term plan, Penn West said.

"This renewal and the planned future reduction in our bank facility are key steps in Penn West's long-term plan", said Dave Roberts, president and CEO. There is about $300 million currently drawn on the facility, the company noted.

A syndicate of Canadian and international banks, co-led by Canadian Imperial Bank of Commerce and Bank of Montreal, handled the facility renewal, the company said.