Spring Energy`s exploration loan facility increased to NOK 2,000 million
Spring Energy holds a portfolio consisting of 31 licenses on the NCS, out of which 5 as operator.
The company’s firm drill queue currently consists of ten highly attractive wells that according to plan will to be drilled over the next 18 – 24 months. The 10 well drilling campaign will target ~ 90 mmboe in risked prospective resources (~ 300 mmboe in unrisked prospective resources).
As a consequence of the company’s high drilling activity over the next couple of years, Spring Energy has increased its exploration loan facility from NOK 1,500 million up to NOK 2,000 million funding a significant portion of the company’s exploration expenditure for the period 2012 – 2014.
The facility had the strong support of a group of relationship banks led by SEB as the Sole Coordinating Mandated Lead Arranger and Bookrunner, DNB Bank ASA as Mandated Lead Arranger, Swedbank as Senior Lead Arranger and BNP Paribas and Sparebank1 SR-Bank ASA joined as Lead Arrangers. SEB acted as the facility Agent and the exploration loan facility was significantly oversubscribed.
Under the Norwegian tax regime, exploration focused companies recover 78% of exploration and appraisal related expenditure in December the following year. The credit facility provides pre-funding of approximately 75 percent of the company’s exploration, appraisal and supporting expenditure, thereby quadrupling the capital available for investment in exploration and appraisal activities.
The increased exploration loan facility together with the equity finance commitment from HitecVision, will enable Spring Energy to pursue an ambitious exploration and appraisal driven growth strategy going forward capitalising on the successes achieved since the company’s start-up in 2008.