Premier Oil today confirmed it has now secured lock up agreements from its debtholders as it advances its refinancing arrangements.
It represents the final stage of requirements before the process of executing the financial restructuring, according to Phillips.
The analyst says the refinancing, when it occurs, will be a relief to the Premier Oil share price, but the group’s longer term future will be less certain.
He believes that managing the closer relationship between the company and the lenders will be “the next battle”.
“At its conclusion, the future of the company passes into the creditors’ hands, which given their respective aims and objective (bondholders want their money back), will naturally result in a migration towards lower risk and return projects,” the analyst said in a note.
“The extent to which the company minimises or alters its exploration programmes will also be a function of the ability of the management to convince its new shadow operations committee that risks are worth taking.”