HOUSTON--(BUSINESS WIRE)--Buccaneer Energy Limited (ASX: BCC) is pleased to advise that its wholly owned subsidiary Buccaneer Alaska, LLC (“Buccaneer” or “the Company”) has executed a $50.0 million senior asset backed revolving credit facility with Centaurus Capital LP, a Houston-based investment fund.
The credit facility, which matures in November 2016, is secured by receivables to be paid by the State of Alaska and available to the Company under the Alaskan Clear & Equitable Share (“ACES”) rebate program that was implemented by the State of Alaska in 2007. The Company intends to use the proceeds from the credit facility for drilling exploration and development activities on its five Alaska lease areas. This facility will provide approximately 50% of all capital expenditures on the aforementioned leases.
Under the ACES program all rebates for capital expenditure are paid between 5 and 18 months after expenditure has been incurred. While the maximum amount to be drawn down at any one time under the facility will be US$50 million, it is anticipated that a multiple of this amount will be utilized over the life of the facility.
To date the Company has accrued approximately US$13.5 million in ACES rebates through capital expenditures on its Kenai Loop project. The credit facility allows the Company to access approximately US$12.8 million against these accrued ACES receivables.
The US$13.5 million in accrued ACES receivables is anticipated to be paid to the Company under the ACES program between December 2011 and July 2012. On receipt, these funds will automatically repay advances made to the Company under the credit facility but will be available to the Company for a draw down to fund future capital expenditures.
Buccaneer Director Dean Gallegos said:
"This credit facility is an important step for the Company. It funds a large piece of our development program going forward, significantly reducing the use of equity.
It also marks the first time the Company has accessed the North American senior debt market. There is a great deal of interest in the Company’s Alaskan activities and it is an area we will continue to develop. It is also thought that this is the first time this type of structure has been applied to an oil and gas exploration based government rebate in the North American market, so to a large extent we are breaking new ground.”
Buccaneer Energy Limited (ASX: BCC) is an energy exploration and production company. Through its wholly owned subsidiaries, Buccaneer Resources and Buccaneer Alaska, the U.S. headquartered independent is focused on acquiring significant working interests in undervalued, low-risk development properties that possess significant undeveloped upside potential. The Company places a premium on bringing both regional and local expertise to each opportunity, and as a result, its opportunistic approach to finding hydrocarbons is not limited by geographic considerations.
Buccaneer Resources is focused on the Gulf of Mexico, onshore opportunities in the lower 48 and certain international opportunities around the world. Under Buccaneer Resources, the Company operates its Pompano field and Lee County producing assets. Buccaneer Alaska focuses on developing opportunities in the Cook Inlet of Alaska that includes the Kenai onshore project and other offshore opportunities.
For more information visit the Company’s website at www.buccenergy.com.
1 Using a Gas to Oil conversion ratio of 8:1