Business
Athabasca Oil Corporation Announces Proposed Private Offering of Senior Secured Notes
/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITE...
About this update from Athabasca Oil Corporation
[{"type":"text","content":"\n\n\n\n\n\n/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR\n DISSEMINATION IN THE UNITED STATES/\n\n\nCALGARY, Nov. 5, 2012 /CNW/ - Athabasca Oil Corporation (TSX: ATH)\n announces that it intends to issue, on a private placement basis, up to\n C$600 million in aggregate principal amount of senior secured second lien\n notes which will be due in 2017. Athabasca may issue the notes in\n connection with this private placement offering or in future offerings\n from time to time. In conjunction with the note offering, the Company\n is currently negotiating senior secured first lien revolving credit\n facilities with a syndicate of financial institutions. The revolving\n credit facilities are anticipated to be initially on the order of C$150\n million. Timing, size, terms and completion of these transactions are\n subject to market conditions and other factors.\n\n\nAthabasca intends to use the net proceeds from the private placement and\n the credit facilities for general corporate purposes, including the\n advancement of its thermal oil projects in Athabasca and the\n development of its light oil assets in Kaybob and Saxon/Placid. The\n proposed note offering and credit facilities are intended to provide\n Athabasca with additional liquidity and flexibility to fund and\n possibly expand its future capital expenditure programs.\n\n\nAs at September 30, 2012, Athabasca had a very strong balance sheet with\n cash, cash equivalents, short term investments and restricted cash of\n approximately C$626 million. The Company currently has no debt.\n\n\nAthabasca's five year plan includes the developments of the Hangingstone\n and Dover West thermal oil (oil sands) projects, the pilot production\n test at the Dover West Leduc carbonate reservoir and the development of\n the light oil production areas in Kaybob and Saxon/Placid. To execute\n this plan the Company has assumed using cash on hand and a modest level\n of debt, in addition to using proceeds from future joint ventures and\n from the possible exercise of the Put/Call Option in respect of\n Athabasca's Dover Thermal Oil Asset.\n\n\nThe Company has been evaluating its capital structure during 2012 and\n believes the current market presents the Company with a favourable\n opportunity to seek debt financing and reduce the Company's overall\n cost of capital. It will als...