Bankers Petroleum in talks for new $110 million credit facility

By Sara Rosenberg

New York, Feb. 25 - Bankers Petroleum Ltd. is in negotiations for a new up to $110 million reserve-based credit facility, according to a news release.

If successful, International Finance Corp. and the European Bank for Reconstruction and Development would provide the financing.

The facility is expected to consist of a $50 million six-year revolver, another $50 million six-year revolver and two eight-year term loans totaling $10 million.

Proceeds would be used to fund upcoming capital requirements and working capital needs for the company's Albanian projects. The term loan debt would be used specifically for environmental remediation purposes.

The term loans are expected to be available immediately upon preparation and finalization of an environmental remediation action plan, amounts under the first $50 million revolver will be fully available when the Brent oil price stabilizes above $55 per barrel, and the second revolver is subject to mutual agreement among the parties when Bankers' production exceeds 10,000 bopd and the Brent oil price stabilizes above $62 per barrel.

It is expected that this facility will be in place during the second quarter, subject to ongoing discussions with the potential lenders, completion of all required documentation for approval, and necessary regulatory and stock exchange approvals.

As part of the facility, the lenders will get eight million common share purchase warrants each. When issued, each warrant will entitle the lenders to purchase one common share of the company at a price of C$1.50 per common share.

Bankers Petroleum is a Calgary, Alta.-based oil and gas exploration and production company.

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