Marquee Energy has signed a capital funding agreement with Crown Capital Fund IV and has closed a new credit facility with an undisclosed Canadian bank to expand the drilling programme at its Michichi in eastern Alberta, Canada.
Under the agreement, Crown Capital will provide a $30m subordinated term loan to the company in exchange for 37.5 million warrants or around 8.6% of the outstanding shares of Marquee Energy.
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In addition to repaying the previous syndicated loan, Marquee has determined that the term loan amount will be used to ensure long-term funding and liquidity certainty.
The term loan will also support an expanded drilling programme of high netback and high rate of return horizontal light oil wells at Michichi.
The objective of the capital programme is to increase cashflow, production and reserves.
Marquee Energy president and CEO Richard Thompson said: "Marquee is pleased to have a new strategic partner in Crown Capital who is supportive of unlocking the value of our Michichi asset in eastern Alberta.”
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By GlobalDataThe company is planning a drilling programme for six light oil horizontal Banff wells in the second half of this year, with a corporate exit rate of 3,000 barrels of oil equivalent a day (boed) to 3,300boed.
The second half of the programme is scheduled to begin by July and will involve mono-bore drilling with increased frack stages to improve productivity and reserves recoveries.
In addition to legacy horizontal well optimisation, the capital spending also includes operating capital, normal course abandonment and reclamations costs, as well as seismic and land acquisition expenditures.
Marquee is focused on light oil development and production in the Michichi area.
