Kodiak Oil & Gas generates record cash, ends Q3 with $2.2 billion debt

By Lisa Kerner

Charlotte, N.C., Nov. 1 - Kodiak Oil & Gas Corp. "closed the books on another record quarter" that saw the company "produce more oil and generate more cash than we ever have in our history," according to chairman and chief executive officer Lynn Peterson.

Net cash provided by operating activities during the third quarter was $152.6 million, compared to $89.2 million during the same period in 2012, an increase of 71%.

The Denver-based oil and gas exploration and production company held its third-quarter earnings conference call on Friday.

Chief financial officer Jim Henderson said the Kodiak's balance sheet and liquidity are in "great shape," and the company's necessary funding is in place for the remainder of the year as well as for 2014.

Henderson said the company successfully completed a notes offering that was upsized to $400 million and priced to yield 5½%. Proceeds were used to pay down a portion of the borrowings outstanding under Kodiak's revolver.

The company is undergoing a semiannual redetermination with its bank group to update the borrowing base under its existing credit agreement.

"The current revolver balance is about $680 million, so we have about $420 million available before the ongoing redetermination," Henderson said.

Kodiak ended the quarter with cash of $18.32 million and total long-term debt of about $2.2 billion, compared to about $1.1 billion at year-end, according to a form 10-Q filed with the Securities and Exchange Commission.

As of Sept. 30, the company had maximum credit available under its credit facility of $1.5 billion with a borrowing base and total commitment of $1.1 billion, the filing stated.

Interest expense for the quarter totaled $21 million.

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