Diversified Gas & Oil PLC (LON:DGOC), the US-based owner and operator of natural gas, natural gas liquids, and oil wells as well as midstream assets, has revealed that the company's bank lending group, led by KeyBank National Association, has completed the semi-annual redetermination of the group's senior secured credit facility and reaffirmed the existing $425mln borrowing base.
It said the bank group also approved amendments enhancing the company's hedging capabilities, with no changes to pricing or covenant terms.
DGOC added that it expects to complete its next scheduled redetermination in the fourth quarter of 2020.
Following the redetermination, DGOC's net debt approximates $756mln and current liquidity approximates $213mln, comprised of cash on hand and availability under the facility.
The company's current borrowings result in a Net Debt to EBITDA ratio of approximately 2.2x(a), below stated targets and debt covenant thresholds.
Rusty Hutson, Jr DGOC’s CEO commented: "The reaffirmation of our borrowing base in this challenging environment speaks to the quality of our production, reserves and our strategy that is focused on generating steady positive cash flow to reduce debt and maintain a healthy balance sheet while consistently returning cash to shareholders through the dividend.
“This redetermination, together with other financings completed this year, demonstrates our ability to access competitive capital against a difficult economic backdrop. I would like to thank our 17-member bank group for their continued support as we remain focused on prudent growth in a market with increasing opportunities for those with an ability to transact and a proven record of successful execution."