Sabine Oil & Gas Corp.’s (OTCQB: SOGC) borrowing base under its revolving credit facility has been decreased from $1 billion to $750 million as part of the company's regularly scheduled semi-annual redetermination by its lenders.
The decrease in the borrowing base has resulted in a deficiency of $250 million, which must be repaid in six monthly installments of $41.54 million, with the first payment being due at the end of May.
Additionally, the company continues to work with the lenders under its revolving credit facility to address the existing default under the facility before the end of the grace period on May 8. Sabine has retained financial advisors Lazard and legal advisors Kirkland & Ellis LLP to advise management and the board of directors on strategic alternatives related to its capital structure.
As of April 20, Sabine had a cash balance of $280 million, which provides liquidity to fund its current operations. Sabine is continuing to pay suppliers and other trade creditors in the ordinary course.