New Source reduces revolver borrowing base, postpones redetermination

By Marisa Wong

Madison, Wis., April 10 – New Source Energy Partners LP said it entered into an agreement with the administrative agent Bank of Montreal to postpone the scheduled April 1 semiannual redetermination of the borrowing base under its revolving credit facility.

The redetermination of the borrowing base has been pushed back to May 1, according to an 8-K filing with the Securities and Exchange Commission.

In addition, the borrowing base available under the revolver was reduced, effective April 8, to $84 million from $90 million. This was the amount of borrowings outstanding as of April 8.

The agreement also provides that, prior to the borrowing base redetermination on May 1, the partnership will not declare or make any distributions on its common units until the total outstanding borrowings under its revolver is at or below $55 million.

“We have previously stated that we believe the borrowing base under the partnership’s credit facility would be reduced by $20 million to $30 million,” chairman and chief executive officer Kristian Kos said in a press release.

“The lenders are currently finalizing their review in order to determine the updated borrowing base. However, we believe the $20 million to $30 million range is still accurate.

“The agreement with BMO postpones the redetermination by one month, which allows the partnership more time to secure financing opportunities currently under review.”

The energy company is based in Oklahoma City.

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