CALGARY, May 21, 2019 /CNW/ - Bonterra Energy Corp.
(www.bonterraenergy.com) (TSX: BNE) ("Bonterra" or the "Company")
today announces that following the annual review of its credit
facilities, Bonterra management and Board of Directors have
determined, along with the bank syndicate, that amending the credit
facilities will better reflect the Company's current operating
needs and strategy. The amended credit facilities are
comprised of a $300 million
syndicated revolving credit facility (previously $330 million), a $40
million non-syndicated revolving credit facility (previously
$50 million) (the "Bank Facility")
and the addition of an accordion feature which allows the Company
to obtain future funding of up to $40
million for opportunities outside of normal operations, such
as acquisitions, subject to unanimous lender approval (the "Amended
Facilities"). The terms of the Amended Facilities provide
that the loan is revolving to April 28,
2020, with a maturity date of April
28, 2021, subject to annual review.
Bonterra has prudently set its capital expenditure budget for
2019 with flexibility to adjust spending based on commodity
prices. As a result, the Amended Facilities afford the
Company with ample liquidity and sufficient financial flexibility
to execute on its business plan, which includes directing free
funds flow to ongoing debt repayment. Currently, Bonterra is
drawn approximately $300 million on
the $340 million Bank Facility.
Based on the Company's assumptions regarding commodity prices using
current strip pricing, as well as budgeted production levels for
the balance of the current year, funds flow is expected to be
approximately $110 to $115 million for 2019. Therefore, with capital
expenditures currently budgeted for $57
million and annual dividend payments of $4 million, the Company anticipates generating
approximately $49 to $54 million of free funds flow for 2019.
With strengthening commodity prices and declining debt levels,
Bonterra's sustainability can be further enhanced, enabling the
Company to consider increased capital spending levels or possible
dividend increases.
The terms of the Amended Facilities are substantially consistent
with those governing the previous credit facilities, with enhanced
compliance and reporting features related to Alberta Energy
Regulator ("AER") regulations regarding abandonment and reclamation
activities and certain restrictions on acquisition and disposition
activity to ensure strict conformance with pre-determined liability
management ratings.
Bonterra Energy Corp. is a conventional oil and gas corporation
with operations in Alberta,
Saskatchewan and British Columbia. The Company's shares are
listed on The Toronto Stock Exchange under the symbol "BNE".
Use of Non-IFRS Financial Measures
In this release the
Company uses the terms "funds flow " and "free funds flow" to
analyze operating performance, which are not standardized measures
recognized under IFRS and do not have a standardized meaning
prescribed by IFRS. These measures are commonly utilized in the oil
and gas industry and are considered informative by management,
shareholders and analysts. These measures may differ from those
made by other companies and accordingly may not be comparable to
such measures as reported by other companies.
The Company defines funds flow as funds provided by operations
excluding the effects of changes in non-cash working capital items
and decommissioning expenditures settled. The Company calculates
free funds flow by deducting capital expenditures and dividend
payments from funds flow from operations.
Forward Looking Information
Certain statements
contained in this release include statements which contain words
such as "anticipate", "could", "should", "expect", "seek", "may",
"intend", "likely", "will", "believe" and similar expressions,
relating to matters that are not historical facts, and such
statements of our beliefs, intentions and expectations about
development, results and events which will or may occur in the
future, constitute "forward-looking information" within the meaning
of applicable Canadian securities legislation and are based on
certain assumptions and analysis made by us derived from our
experience and perceptions. Forward-looking information in this
release includes, but is not limited to: expected cash provided by
continuing operations; cash dividends; future capital expenditures,
including the amount and nature thereof; plans to repay
indebtedness; oil and natural gas prices and demand; expansion and
other development trends of the oil and gas industry; business
strategy and outlook; expansion and growth of our business and
operations; and other such matters.
All such forward-looking information is based on certain
assumptions and analyses made by us in light of our experience and
perception of historical trends, current conditions and expected
future developments, as well as other factors we believe are
appropriate in the circumstances. The risks, uncertainties, and
assumptions are difficult to predict and may affect operations, and
may include, without limitation: foreign exchange fluctuations;
equipment and labour shortages and inflationary costs; general
economic conditions; industry conditions; changes in applicable
environmental, taxation and other laws and regulations as well as
how such laws and regulations are interpreted and enforced; the
ability of oil and natural gas companies to raise capital; the
effect of weather conditions on operations and facilities; the
existence of operating risks; volatility of oil and natural gas
prices; oil and gas product supply and demand; risks inherent in
the ability to generate sufficient cash flow from operations to
meet current and future obligations; increased competition; stock
market volatility; opportunities available to or pursued by us; and
other factors, many of which are beyond our control. Readers are
cautioned that the foregoing list of factors is not exhaustive.
Additional information on these and other risk factors that could
affect results of operations, financial performance or financial
results are included in our most recent Annual Information Form and
in other reports filed with Canadian securities regulatory
authorities.
Actual results, performance or achievements could differ
materially from those expressed in, or implied by, this
forward-looking information and, accordingly, no assurance can be
given that any of the events anticipated by the forward-looking
information will transpire or occur, or if any of them do, what
benefits will be derived there from. Except as required by law,
Bonterra disclaims any intention or obligation to update or revise
any forward-looking information, whether as a result of new
information, future events or otherwise.
This press release also contains information that may constitute
future-orientated financial information or financial outlook
information (collectively, "FOFI") about the Company's prospective
results of operations including, without limitation, funds flow
from operations and free funds flow, all of which is subject to the
same assumptions, risk factors, limitations and qualifications as
set forth above. Readers are cautioned that the assumptions used in
the preparation of such information, although considered reasonable
at the time of preparation, may prove to be imprecise or inaccurate
and, as such, undue reliance should not be placed on FOFI. The
Company's actual results, performance and achievements could differ
materially from those expressed in, or implied by, the FOFI. The
Company has included the FOFI in order to provide readers with a
more complete perspective on our future operations and our current
expectations relating to the Company's future performance. Such
information may not be appropriate for other purposes and readers
are cautioned that any FOFI contained herein should not be used for
purposes other than those for which it has been disclosed herein.
FOFI contained herein was made as of the date of this press
release. Unless required by applicable laws, the Company does not
undertake any obligation to publicly update or revise any FOFI
statements, whether as a result of new information, future events
or otherwise.
The forward-looking information contained herein is expressly
qualified by this cautionary statement.
Numerical Amounts
The reporting and the
functional currency of the Company is the Canadian dollar.
SOURCE Bonterra Energy Corp.
