UK exploration & production company EnQuest has completed its financial restructuring, announced back in October, designed to help the company deliver first oil from the North Sea’s Kraken development in the first half of 2017.
The company concluded the final stage in the restructuring process on Monday, November 21. The restructuring comprises the implementation of the RCF Amendments, the Note Amendments, the renewal of the Surety Bond Facilities and the Placing and Open Offer.
The restructuring included, among other things, extension of the final maturity date for the existing revolving credit facility to October 2021 as well as the completion of the Placing and Open Offer, according to which the company has raised gross aggregate proceeds of £82 million.
EnQuest claims that the completion of the restructuring provides the company with a stable and sustainable capital structure, reduced cash debt service obligations and greater liquidity amid a reported net debt of $1.68 billion during the first half of 2016, compared to net debt of $1.55 billion in the same period last year.
“These will all contribute to ensuring that the Group is in a strong position to pursue its strategy of targeting mature and marginal oil assets and its focus on cost efficiency during a prolonged period of low oil prices. In particular, the Restructuring will enable the Group to complete the Kraken and Scolty/Crathes developments, which the company expects will lead to both significant increases in production and significant decreases in average unit operating costs across the Group,” EnQuest explained on Monday.
When it comes to its UK North Sea developments, EnQuest also reported on Monday it achieved first oil from the Scolty/Crathes development and that the Kraken FPSO would head from Singapore to its North Sea location ‘in the coming days’ keeping the company on course to deliver first oil in the first half of 2017.
Amjad Bseisu, Chief Executive of EnQuest, said: “We have been delighted at the level of support received for EnQuest’s capital restructuring; with 100% backing from our revolving credit facility lenders and hedging banks, 99.9% of votes being cast in favor of the Scheme by the scheme creditors, 98.9% of shareholder votes being cast in favour of EnQuest’s general meeting resolutions and backing from all of our surety bonds providers.
“This restructuring will significantly improve EnQuest’s liquidity position, ensuring that we are well positioned for the future, including delivering first oil from the Kraken development, with its unit operating costs expected to be in the low $20s per barrel once it is fully on-stream.”
Offshore Energy Today Staff