Centennial Resource amends and restates $600 million credit agreement

By Sarah Lizee

Olympia, Wash., May 8 – Centennial Resource Development, Inc.’s subsidiary, Centennial Resource Production, LLC, entered into a second amendment to its amended and restated credit agreement with JPMorgan Chase Bank, NA as administrative agent on Friday, according to an 8-K filing with the Securities and Exchange Commission.

The amendment provides for elected commitments of $600 million, an initial borrowing base of $800 million and a total maximum revolving credit amount of $1.5 billion.

The credit agreement has a term of five years and is secured by substantially all of the assets owned by the Centennial Resource Production and its subsidiaries.

The amount available to be borrowed under the revolver is subject to a borrowing base that is redetermined semiannually each April 1 and Oct. 1 by the lenders, with two optional redeterminations on Jan. 1 and July 1.

The borrowing base depends on, among other things, the quantities of Centennial Resource Production’s proved oil and natural gas reserves, estimated cash flows from these reserves and the company’s commodity hedge positions.

Borrowings under the revolver bear interest at Libor plus a margin ranging from 150 to 250 basis points, depending on the percentage of borrowing base use. The commitment fee on unused amounts under the facility ranges from 37.5 to 50 bps.

The company is required to maintain a ratio of consolidated current assets to consolidated current liabilities of not less than 1 to 1 and a ratio of total funded debt to consolidated EBITDAX for the rolling four fiscal quarter period of not greater than 4 to 1.

JPMorgan Chase is the lead arranger and bookrunner, while Wells Fargo Bank, NA, Royal Bank of Canada and Comerica Bank are co-syndication agents.

BMO Harris Bank, NA, Canadian Imperial Bank of Commerce, New York Branch and U.S. Bank NA are co-documentation agents.

Denver-based Centennial Resource Production is an independent oil and natural gas company with properties in the core of the Southern Delaware Basin.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.