Osage Exploration and Development announced that the company entered into a new $30 million draw-down credit facility with Apollo Investment. The agreement refinances Osage’s existing $20 million credit facility and provides an additional $10 million of liquidity at an overall interest rate approximately 25% lower than Osage’s previous credit facility with Apollo.
Further, all previous loan covenants were reset, and Osage’s cost of capital on the entire $30 million facility has decreased to LIBOR plus 11% as opposed to the previous rate of LIBOR plus 15%. No additional warrants or equity of any kind was issued by the company in connection with this refinancing.
“Osage was fortunate enough to receive the early financial support of Apollo while we were still in the infancy of our Mississippian and Woodford project. Now we are intent on achieving much greater growth in production, and we are still doing so with the full confidence and support of Apollo. We feel the ability to simultaneously increase our borrowings with a correspondingly reduced interest rate underscores Apollo’s commitment to grow with us as we move aggressively forward in our current operating mode. Our goal to keep one rig running continuously in Logan County and to begin drilling our Pawnee County and Coal County projects with a second rig is absolutely within our reach this year. This additional capital will enable us to demonstrate the true potential of these three projects, which will unlock tremendous value for Osage. This is the time that Osage shareholders have been waiting for,” said Kim Bradford, Chairman and CEO.
Based in San Diego, Osage Exploration and Development is an independent exploration and production company with interests in oil and gas wells and prospects in the U.S.