Nighthawk Energy plc Bank Covenant Compliance and Production Update (5854I)

TIDMHAWK

RNS Number : 5854I

Nighthawk Energy plc

10 December 2015

NIGHTHAWK ENERGY PLC

("Nighthawk" or "the Company")

Bank Covenant Compliance and Production Update

Nighthawk, a US focused oil company (AIM: HAWK and OTCQX: NHEGY), announces a breach in certain covenants under the Company's Reserve Based Loan ("RBL") and provides an update on production, current hedging position and the water flood project.

RBL Covenant Compliance

On December 9, 2015, the Company was formally notified that as of September 30, 2015, the Company was not in compliance with the terms of the RBL, principally the total debt to EBITDAX covenant, as defined in its loan with the Commonwealth Bank of Australia ("CBA"). As of the same date, the Company received a limited term waiver of these events of default from CBA. The Company and the bank are working together to modify or adjust the covenants under the RBL to provide for a long term solution that will allow ongoing compliance. It is expected that these modifications will be in place on or before December 22, 2015. It is not expected that these changes to the RBL will accelerate the maturity date of the loan.

Production

The Company's gross daily production for the month of November 2015 was approximately 1,600 barrels or approximately 1,280 barrels per day net. Total year to date gross production through 30 November is approximately 608,000 barrels or 1,821 per day. Total year to date net production through 30 November is approximately 499,000 barrels or 1,492 per day.

Hedging Position

The Company has recently added additional hedges for 2016, such that as of 30 November 2015, the Company has approximately 66% of the 2016 proved developed producing volumes that are available to be hedged under the RBL, under various contracts, at a weighted average price of $61.40.

Water Flood Project

The Company's 2016 water flood project continues to progress as planned. The formal hearing with the Colorado Oil and Gas Conservation Commission will take place on January 25th. Although the Company cannot predict the outcome of the hearing, it expects that the application for the water flood unit will be approved.

Chuck Wilson, Chief Operating Officer of Nighthawk, who has over 33 years of experience in the oil and gas industry and meets the criteria of qualified persons under the AIM guidance note for mining and oil and gas companies, has reviewed and approved the technical information contained in this announcement.

Glossary

EBITDAX (earnings before interest, income taxes, depreciation, depletion and amortization, exploration and other noncash charges)

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Enquiries:

 
 Nighthawk Energy plc 
 Rick McCullough, Executive 
  Chairman                          +1 303 407 9600 
 Kurtis Hooley, Chief 
  Financial Officer            +44 (0) 20 3582 1350 
 
 Westhouse Securities 
  Limited                      +44 (0) 20 7601 6100 
 Alastair Stratton 
 Robert Finlay

This information is provided by RNS

The company news service from the London Stock Exchange

END

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