Atlantic Petroleum, a Faroese oil and gas company with assets in the North Sea, has refinanced its debt with its main creditor Eik Bank.
Atlantic said on Monday that it had revised terms for the DKK 66 million ($9.5 million) debt to Eik Bank and that the new terms would see the debt paid back from December 2017 to December 2019.
Also, under the loan agreement with London Oil and Gas announced in 2016, Atlantic said that all conditions for the £8 million ($9.7 million) loan were fulfilled. The company’s board has decided to issue convertible instruments to London Oil and Gas for up to £8 million plus interest.
As per March 13 the company has drawn £881,478 ($1.1 million) of the loan facility.
To remind, at the time of the agreement with London O&G, the company was working on avoiding going into administration. According to the deal, the London-based firm was prepared to inject funds and assets into Atlantic Petroleum through a convertible instrument.
As per conditions, London Oil & Gas agreed to an exclusivity period of 90 days and to forward a loan of minimum £47,000 ($57,000) per month for the duration of the exclusivity period.
Atlantic added on Monday that London Oil and Gas had security in the assets of P/F Atlantic Petroleum, Atlantic Petroleum North Sea Limited and certain assets in Atlantic Petroleum UK. Eik Bank, on the other hand, has security in the assets of Atlantic Petroleum Norge AS and certain assets in Atlantic Petroleum UK.
Ben Arabo, CEO of Atlantic Petroleum, said: “This completes our refinancing efforts and provides a new base to stand on. We now look forward to securing the remaining value from our existing portfolio and to add new ventures for future growth.”
Recently, Atlantic became the operator of UK Licenses P.1606 and P.1607, the Orlando and Kells, taking over from the previous operator, Iona Energy, which is currently under administration.