Alvopetro Energy today announced a favorable amendment to their existing senior secured credit facility. The maturity date of the Facility has been extended by one year to October 8, 2023, the 3% per annum interest payable in kind ("PIK") has been eliminated effective April 15, 2021, and the covenants pertaining to the payment of dividends have been relaxed. With the elimination of the PIK interest, the effective interest rate declines from 12.5% to 9.5%, a 24% savings. The Facility will continue to be repayable at maturity or earlier at Alvopetro's option without penalty.
Corey Ruttan, President and Chief Executive Officer, commented:
"This amendment allows us to continue our valued relationship with Cordiant Capital and recognizes the strong operating and financial results being generated by our Caburé project. This refinancing is a key prerequisite to accelerating our balanced stakeholder return and reinvestment model. Following the drilling of our two high impact exploration prospects (183-B1 and 182-C1), scheduled to start drilling at the end of June 2021, we expect to be in a position to define our 2022 capital expenditure budget and in turn, our stakeholder return model."
Stephen Foss, Managing Director, Cordiant Capital, commented:
"We are pleased to continue our valued relationship with Alvopetro, to provide on-going support as it expands its operations in Brazil. With its strategic initiatives and its demonstrated commitment to ESG principles, we believe the company is well positioned to continue its growth trajectory."
KeyFacts Energy: Alvopetro Brazil country profile