Earthstone Energy Inc. (NYSE: ESTE) has increased its borrowing base under its senior secured revolving credit facility from $150 million to $185 million in, the company said on Dec. 4.
The company also entered into an amendment to its credit facility which provides for increased flexibility. The $185 million borrowing base will not be reduced upon closing of the company’s previous agreement to sell its Bakken assets.
“The increase in the borrowing base of our credit facility reflects the results the company is achieving through our continuous drilling program in the Midland Basin,” Mark Lumpkin Jr., executive vice president and CEO, said.
On Nov. 20, Earthstone said it agreed to sell its position in the Bakken for about $27 million in cash. The buyer of the company's assets was an affiliate of Statoil ASA (NYSE: STO), according to filings with the Securities and Exchange Commission.
The sale helps continue Earthstone’s evolution from a micro-cap, nonop Bakken/Three Forks company to a small-cap operator that is primarily focused in the Midland Basin.
“We expect to enter 2018 with low leverage and strong liquidity, positioning Earthstone to grow our asset base both through the drillbit and through acquisitions. We appreciate the continued support of our lenders,” Lumpkin added.
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