Oasis Petroleum amends credit facility, downsizes to $625 million

By Wendy Van Sickle

Columbus, Ohio, April 30 – Oasis Petroleum Inc. wholly owned subsidiary Oasis Petroleum North America LLC entered into a fourth amended and restated credit agreement on April 24 to reduce the commitment amount and the borrowing base and adjust pricing, among other things, according to an 8-K filing with the Securities and Exchange Commission.

The commitment amount was reduced to $625 million from $1.1 billion and the borrowing base to $625 million from $1.3 billion. Both amounts will further reduce to $612.5 million on June 1 and to $600 million on July 1.

The amendment also increases the letter of credit commitment by $50 million to $100 million.

As of March 31, the company had cash and cash equivalents of $134 million, total elected commitments of $1.1 billion under the credit agreement and total elected commitments of $575 million under the credit facility through its subsidiary Oasis Midstream Partners LP.

In addition, the company had $522 million of borrowings and $18.9 million of outstanding letters of credit issued under the credit agreement and $487.5 million of borrowings and $1.7 million of outstanding letters of credit issued under the Oasis Midstream Partners credit facility.

The fourth amendment includes a one-time waiver and forbearance agreement regarding a third-party surety indemnity obligation obtained by a subsidiary of the company in support of commitments for a transportation agreement.

Administrative agent Wells Fargo Bank, NA advised the borrower on April 2 that the surety bond constituted additional debt not permitted under the credit agreement and that the borrower's certifications had failed to reflect the existence of the surety bond in its borrowing requests.

Borrowings under the amended credit agreement bear interest at Libor plus a margin ranging from 225 bps to 325 bps, depending on use. There is a commitment fee of 50 bps.

The financial covenants have been amended to provide that the company’s ratio of total debt to EBITDAX shall not, as of the last day of any fiscal quarter, be greater than 4 to 1.

Oasis is a Houston-based oil and natural gas company.

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