RE:RE:Credit facility newsJoe454 wrote:
O boy , I sure hope they put a lot of Vaseline on the shaft , this is going to hurt.
You sure are right Joe! Keep in mind that under the new credit facility terms, if SpyGlass now sells an asset to paydown $35 million of the
reducing term facility by the end of November, the total amount allowed on the
borrowing base facility will automatically be reduced! If indeed it turns out to be dollar for dollar, then SpyGlass is already underwater by $12 million dollars. Their only hope to survive would be to issue new equity!
Also keep in mind that SpyGlass stated in the NR that their average production guidance for 2015 is 9,000 boe/d. Since their average 1st quarter production was 11,050 and 2nd quarter average production was 9850 boe/d, it would stand to reason that the 3rd quarter average will be about 8150 boe/d and 4th quarter average would be about 7950 boe/d, provided that they don't sell anymore assets! But we know that they are preparing to sell a broad array of assets, so their production guidance will be greatly reduced!
Heck, SpyGlass could enter 2016 with less than 4000 boe/d of high decline production! No wonder the credit syndicate is getting worried about SpyGlass's debt!
Kherson