Mach Natural Resources secures $75 million in additional loans

Published 30/08/2024, 23:02
Mach Natural Resources secures $75 million in additional loans

Mach Natural Resources LP ("MNR"), a Delaware-based crude petroleum and natural gas company, has entered into agreements amending its existing credit facilities, reinforcing its financial position. On Monday, the company secured commitments for up to $75 million in additional loans and reaffirmed its borrowing base at the same amount.

The amendments, effective August 26, 2024, involve changes to both the senior secured term loan and revolving credit facilities initially established on December 28, 2023. The first amendment to the term loan credit agreement allows for the additional loans, while the amendment to the revolving credit agreement adjusts terms related to the company's hedging arrangements and confirms the borrowing base.

These financial maneuvers are facilitated by Texas Capital Bank, serving as the administrative agent for the term loan, and MidFirst Bank for the revolving credit facility. Chambers Energy Management, LP also played a role as the loan commitment arranger for the term loan.

Mach Natural Resources, trading under the ticker symbol NYSE:MNR, is recognized as an emerging growth company. The additional liquidity provided by these agreements is expected to support the company's ongoing operations and strategic initiatives.

The specifics of the amendments are detailed in the exhibits attached to the SEC filing, which serve as the basis for this report. The full text of the agreements, Exhibits 10.1 and 10.2, are incorporated by reference into the filing, providing transparency about the terms and conditions.

This financial development, disclosed in a recent SEC filing, underscores Mach Natural Resources' efforts to maintain a robust financial structure amid the dynamic energy market. The company's strategic moves to secure additional capital demonstrate its proactive approach to financial management.

In other recent news, Mach Natural Resources LP reported its second quarter results, missing revenue estimates with a figure of $240 million, compared to the projected $256.62 million. The company also declared a decrease in its rig count, in addition to an updated guidance for 2024. Despite the shortfall in revenue, Mach's net production averaged 89.3 thousand barrels of oil equivalent per day (Mboe/d) in Q2, surpassing the higher end of its guidance. The company also reported a net income of $40 million and Adjusted EBITDA of $136 million for the quarter.

Reacting to market conditions, Mach reduced its operated rig count in the Oswego from two rigs to one during Q2, leading to a 15% reduction in its full-year capital expenditure guidance midpoint. For 2024, the company now anticipates oil volumes to range between 19.4 MBbl/d to 20.6 MBbl/d.

Mach's lease operating expense of $5.72 per barrel of oil equivalent (Boe) was lower than the least expected guidance. The company concluded the quarter with a cash balance of $145 million and a pro forma net-debt-to-Adjusted-EBITDA ratio of 0.9x. These are among the recent developments in Mach Natural Resources LP's operations.

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