Diversified Energy Company PLC (LSE:DEC, OTCQX:DECPF, FRA:DG2) (LSE:DEC) has expanded and extended its credit facility, with the borrowing base increasing by US$200mln to US$625mln.
The maturity date on DEC’s credit facility is extended by two years to August 2025, with the cost set at LIBOR plus 2.75% to 3.75% depending on utilisation.
“We are very pleased with the significant increase to our credit facility amidst a challenging lending environment, and believe it reflects the enlarged bank syndicate's affirmation of the quality and strong free cash generation of our legacy and recently acquired assets,” said chief executive Rusty Hutson.
“We are thrilled to welcome several leading financial institutions to the family of world-class banks participating in our facility, and we look forward to further advancing our lending relationships as we capitalise on the many consolidation and growth opportunities in the market and that others present to us."
At the same time, the company confirmed the completion of its asset acquisition from Tanos Energy Holdings III LLC. It is acquiring the assets alongside investment partner Oaktree Capital Management.
The assets, based in Louisiana and Texas, presently have gross production of around 14,000 barrels oil equivalent per day and have gross reserves of around 40mln barrels.
"We are pleased to have closed our third acquisition within the Central Region,” Hutson said. “We are also actively pursuing the operational and administrative synergies afforded by aggregating assets within a defined area much like we currently enjoy in Appalachia.
“Collectively, these efforts enhance the already significant free cash flow from the Central Region assets that complement our ESG, dividend distribution and debt reduction commitments to stakeholders.”
He added: “With our enlarged credit facility and healthy balance sheet, we are well-positioned to use our financing capabilities to fund additional growth."