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EGC to review alternatives
Posted on Monday, 20 March 2017 14:49
US independent oil and natural gas development and production company Energy XXI Gulf Coast (EGC) is making a move on strategic alternatives, which is usually a code-word for a sale or divestment.
The Texan oilfield operator has already restructured its balance sheet by eliminating more than USD 3.60 billion of debt so it could emerge from Chapter 11 and re-listed on Nasdaq at the end of December.
It has hired Morgan Stanley to evaluate, develop and implement a standalone financial plan and select strategic alternatives to bolster value for shareholders, exploit its material asset base and improve margins.
As part of an emergence from restructuring, EGC entered into a new three-year USD 302.00 million secured credit facility of which USD 74.00 million was drawn as of year-end 2016.
The group had a simplified balance sheet at 31st December 2016, with liquidity of USD 128.00 million comprising cash and equivalents of USD 37.00 million in emergence-related payments and certain trade claims due.
It had reserves of 121.90 million barrels of oil equivalent based on unaudited, internal estimates at the end of the year, and produced an average of 42,500 barrels of oil equivalent per day in the fourth quarter of 2016.
Founded in 2005 as predecessor Energy XXI, the group claims to operate nine of the largest oilfields primarily located in the US Gulf of Mexico waters offshore Louisiana and Texas.
The group’s assets comprised 635 gross producing wells, 452,083 net developed acres and 60 producing fields as of 30th June 2016.
Its bankruptcy was merely one of a number within the sector in recently times, which includes Bonanza Creek filing for Chapter 11 in January and Chaparral Energy aiming to emerge by the end of March.
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