VAALCO Energy Inc. (NYSE:EGY) has executed an amended and restated loan agreement with the International Finance Corporation (IFC), the lender under the company’s credit facility, to convert the existing $15 million balance under the revolving facility to a term loan. The new agreement provides for quarterly principal and interest payments through June 30, 2019 at a rate of LIBOR plus 5.75%. The loan is secured by VAALCO’s offshore Gabon assets and related inventory.
VAALCO has the option to request to draw up to an additional $5 million from the IFC between now and December 31, 2016, with any such drawn amounts to be amortized through June 30, 2018. Quarterly principal payments on the entire term loan, including the $15 million converted amount, will begin after any additional funds are drawn, or VAALCO makes a determination it has no need for the additional funding; interest is paid quarterly throughout the entire term of the loan. All covenants under the agreement remain substantially the same except that the net debt to EBITDAX limitation has been raised from three times EBITDAX to five times EBITDAX through the end of 2016, and then reverts back to three times effective for the quarter ending March 31, 2017. There are no semi-annual redeterminations required under the new fixed term agreement.
VAALCO Energy Inc. is a Houston-based independent energy company principally engaged in the acquisition, exploration, development and production of crude oil. The company's properties and exploration acreage are located primarily in Gabon, Equatorial Guinea and Angola in West Africa.