OPTI Canada to miss June 15 interest payments on 8¼%, 7.785% notes

By Angela McDaniels

Tacoma, Wash., June 14 - OPTI Canada Inc. will not make the interest payments on its $1 billion 8¼% senior secured notes due 2014 and $750 million 7.785% senior secured notes due 2014 that are scheduled for June 15, according to a company news release.

The interest payments total $71 million. The company has until July 15 to make the payment in order to avoid an event of default.

The company will, however, make the $24 million interest payment on its $525 million first-lien notes that is scheduled for June 15.

OPTI said its cash and cash equivalents as of June 15 total about C$220 million after giving effect to the interest payment on the first-lien notes. In addition, it has $73 million of restricted cash in an interest reserve account associated with its $300 million of first-lien notes.

The company continues to review strategic alternatives. OPTI said these alternatives may include a capital structure adjustment, capital market opportunities, asset divestitures and/or a corporate sale, merger or other business combination. A capital structure adjustment may include debt-for-equity exchanges or conversions, which may be combined with raising additional capital.

OPTI Canada is a Calgary, Alta.-based company focused on developing oil sands projects.

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