Gastar Announces Amended and Restated Credit Agreement
30 October 2009 - 7:50AM
PR Newswire (US)
Initial Borrowing Base of $47.5 Million HOUSTON, Oct. 29
/PRNewswire-FirstCall/ -- Gastar Exploration Ltd. (NYSE Amex: GST)
announced today that it has entered into an amended and restated
credit agreement with Amegy Bank, as administrative agent and
co-lead arranger, Bank of Montreal, as co-lead arranger and joint
bookrunner, and IBERIABANK fsb. The new revolving credit facility
provides Gastar an initial borrowing base of $47.5 million at LIBOR
plus 250 to 350 basis points, depending on borrowing utilization
percentage. The Company currently has no borrowings outstanding
under the agreement except for a letter of credit in the amount of
$100,000. The credit facility has a scheduled maturity date of
January 2, 2013 and is subject to semi-annual borrowing base
redeterminations. J. Russell Porter, Gastar's President and Chief
Executive Officer, stated, "We have completely transformed Gastar's
capital structure over the last four months and now have almost no
net debt. This new credit facility gives us the flexibility to
pursue opportunities as they arise under a long-term low cost
facility. The facility may be used from time to time to finance
accelerated drilling activity in East Texas and Appalachia,
exploration activities and additional acreage acquisition in
Appalachia, as well as other investment opportunities and general
corporate purposes. However, we reiterate our commitment to
maintaining a strong balance sheet and funding most business
activities through cash flow from operations." The facility
contains financial covenants typical for this type of lending
including requirements that the Company maintain quarterly an
"Interest Coverage Ratio" of at least 2.50:1.00, a "Total Net
Indebtedness to EBITDA Ratio" not to exceed 4.00:1.00 and a
"Current Ratio" of at least 1.00:1.00, as adjusted. For additional
information, please refer to the amended and restated credit
agreement which will be filed with the Securities and Exchange
Commission on form 8-K. About Gastar Exploration Gastar Exploration
Ltd. is an exploration and production company focused on finding
and developing natural gas assets in North America. The Company
pursues a strategy combining deep natural gas exploration and
development with lower risk shale resource and CBM development. The
Company owns and operates exploration and development acreage in
the deep Bossier gas play of East Texas and Marcellus Shale play in
West Virginia and Pennsylvania. Gastar's CBM activities are
conducted within the Powder River Basin of Wyoming and Montana. For
more information, visit our web site at http://www.gastar.com/.
Company Contact: Gastar Exploration Ltd. Michael Gerlich, Vice
President and CFO 713-739-1800 / Investor Relations Counsel: Lisa
Elliott / Anne Pearson DRG&E : 713-529-6600 / DATASOURCE:
Gastar Exploration Ltd. CONTACT: Michael Gerlich, Vice President
and CFO of Gastar Exploration Ltd., +1-713-739-1800, ; or Investor
Relations Counsel, Lisa Elliott, , or Anne Pearson, , both of
DRG&E, +1-713-529-6600, for Gastar Exploration Ltd. Web Site:
http://www.gastar.com/
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