Obsidian Energy plans up to C$125 million senior notes, C$225 million new credit facilities

By Wendy Van Sickle

Columbus, Ohio, July 19 – Obsidian Energy Ltd. is planning a private placement of up to C$125 million senior notes (S&P: B) and to enter into new syndicated credit facilities with borrowing capacity of up to C$225 million, according to a news release.

The company plans to use proceeds of the notes offering and initial credit facility borrowings to repay all of its senior secured notes due Nov. 30, 2022, to repay the outstanding balances under its credit facilities due Nov. 30, 2022, and to repay the limited recourse loan due on Dec. 31, 2022, which was incurred in connection with Obsidian’s 2021 acquisition of the remaining 45% interest in the Peace River Oil Partnership.

The credit facilities will include C$175 million of revolving facilities and an up to C$50 million term loan.

The banking syndicate will include Royal Bank of Canada, Bank of Montreal and Canadian Western Bank.

The company plans to use up to C$30 million of the term loan and C$130 million of the revolver along with the notes’ proceeds to complete the refinancing of existing debt.

The revolving period of the new C$175 million of revolving facilities end on the first anniversary of the date the funds become available. That anniversary is expected to be July 26, 2023. The term-out period will end a year after that.

The new syndicated facilities will have semiannual borrowing base redeterminations.

The new term loan will mature on Dec. 31, 2022.

Obsidian Energy is a Calgary, Alta.-based oil and natural gas production company.

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