CALGARY, AB, Oct. 5, 2020 /CNW/ - Bonterra Energy Corp.
(www.bonterraenergy.com) (TSX: BNE) ("Bonterra" or the "Company")
is pleased to announce that it has received a reserve based lending
commitment from Export Development Canada ("EDC") of up to
$38.4 million (the "EDC Commitment").
In addition, Bonterra is pleased to confirm that to date, its
vendors have been approved for $21
million of funding through Alberta's Site Rehabilitation Program ("SRP").
These amounts build on the Company's recently approved $45 million Business Development Bank of
Canada ("BDC") term facility.
Between EDC, BDC, and the SRP, the Company has now been approved
for over $104 million of credit
availability (pending legal and banking documentation). These
commitments will provide Bonterra with significant additional
long-term liquidity at reasonable interest rates to withstand the
impacts of the COVID-19 pandemic and allow the Company to continue
pursuing development of its high-quality, Cardium light oil asset
base in order to generate long-term, sustainable net asset value
per share growth as the economy recovers.
EDC Commitment
The EDC Business Credit Availability
Program ("BCAP") was initially announced to provide additional
liquidity and cash flow to companies who were deemed financially
viable pre-COVID-19, allowing them to continue operations and
development activity throughout a recovery from the pandemic,
supporting a return to pre-COVID-19 operating levels within a
manageable timeframe based on strengthening crude oil, liquids and
natural gas prices. Bonterra has been in discussions with both EDC
and BDC regarding their programs since April
2020, and believes the $38.4
million EDC Commitment, combined with the previously
announced and approved BDC term facility, subject to legal and
banking documentation, demonstrates the confidence EDC and BDC
maintain in the Company. The $38.4
million lending commitment has a tenure of up to two years,
is renewable at maturity at EDC's discretion, and is subject to
legal and banking documentation, in a form satisfactory to EDC
.
SRP Awards
In partnership with its vendors, the
Company has received, to date, $20
million in-kind of SRP funding and an additional
$1 million as an Area Based Closure
("ABC") participant for a total of $21
million. The funding will assist with abandoning and
reclaiming 189 pipelines (179,000 meters) and 379 well bores,
ultimately reducing Bonterra's operated inactive well count by 59%
over the next two years and reducing the Company's pre-SRP annual
spending commitments under the ABC program from approximately
$3 million to $2 million per year going forward.
BDC Credit Facility
As previously announced, the
Company was approved by BDC for a second lien non-revolving
four-year term facility for up to $45
million (the "BDC Term Facility"), subject to legal and
banking documentation. The BDC Term Facility offers Bonterra
significant additional long-term liquidity at reasonable interest
rates to withstand the impacts of the COVID-19 pandemic and allow
the Company to continue pursuing development of its high-quality,
Cardium light oil asset base in order to generate long-term,
sustainable net asset value per share growth as the economy
recovers.
Bonterra Energy Corp. is a conventional oil and gas corporation
with operations in Alberta,
Saskatchewan and British Columbia, focused on its strategy of
long-term, sustainable growth and value creation for shareholders.
The Company's shares are listed on The Toronto Stock Exchange under
the symbol "BNE".
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: credit
commitments pursuant to the EDC, BDC and SRP programs and the
anticipated amount and terms of funding that will become available
to the Company pursuant to such programs; the Company's spending
commitments under the ABC program; the Company's inactive well
count; 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: risks and uncertainties relating
to the completion of definitive legal and banking documentation and
the satisfaction of all conditions relating to the availability of
funding pursuant to government programs; 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.
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 therefrom. 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. 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.
The TSX does not accept responsibility for
the accuracy of this release.
SOURCE Bonterra Energy Corp.