Bellatrix Exploration Ltd. (“Bellatrix” or the “Company”) (TSX, NYSE: BXE) is pleased to announce the successful start-up of Phase 1 of the Bellatrix O’Chiese Nees-Ohpawganu’ck deep cut gas plant in the Alder Flats area of Alberta (the “Bellatrix Alder Flats Plant” or the “Plant”). Bellatrix is also pleased to announce the completion of the current semi-annual borrowing base redetermination under its bank credit facilities.
Phase 1 of the Bellatrix Alder Flats Plant is Fully Operational
Bellatrix successfully completed construction of Phase 1 of the Bellatrix Alder Flats Plant ahead of schedule and on budget. Initial Plant start-up commenced on May 22, 2015, followed by first delivery of natural gas volumes to sales. Subsequent to Plant start-up, Bellatrix has successfully increased volume throughput at the Plant, ultimately achieving inlet gas volumes of over 110 mmcf/d by mid-June. Completion and successful ramp up of volumes through the Plant represent significant milestones for Bellatrix. The Bellatrix Alder Flats Plant improves the Company’s operational control and enhances reliability of processing. With the Plant now fully operational, the Company expects to meaningfully realize these strategic benefits during the second half of the year.
Semi-Annual Borrowing Base Redetermination
Bellatrix’s syndicate of lenders has completed its semi-annual review of the borrowing base under the Company’s revolving credit facilities and has approved Bellatrix’s request for a revised borrowing base of $600 million. The semi-annual redetermination was initially scheduled to be completed in May 2015, but was deferred to facilitate the Company’s offering of US$250 million of 8.5% senior unsecured notes due 2020 (the “Senior Notes”), which was completed on May 21, 2015. The revised borrowing base incorporates an automatic reduction equal to two times the annual interest cost of the Senior Notes and a redetermination based on the syndicate’s review of the current estimated value of the Company’s proved reserves under the syndicate’s pricing assumptions. The revised borrowing base is anticipated to result in lower standby fees charged on unutilized amounts available under the credit facilities. As at May 31, 2015, Bellatrix had drawn approximately $365 million on its credit facilities, and after giving effect to the redetermined borrowing base, Bellatrix would have had access to approximately $235 million of liquidity under the credit facilities before deducting outstanding letters of credit.
The Company’s credit facilities are available on an extendible revolving basis and consist of a $75 million operating facility provided by a Canadian bank and a $525 million syndicated facility provided by nine financial institutions, subject to a borrowing base test. The three year revolving facilities mature on May 30, 2017, unless extended for a further period not to exceed a maximum term of up to three years. The borrowing base is subject to re-determination on May 31 and November 30 in each year prior to maturity, with the next semi-annual redetermination scheduled to occur on November 30, 2015.
Bellatrix Exploration Ltd. is a Western Canadian based growth oriented oil and gas company engaged in the exploration for, and the acquisition, development and production of oil and natural gas reserves in the provinces of Alberta, British Columbia and Saskatchewan. Common shares of Bellatrix trade on the Toronto Stock Exchange and on the New York Stock Exchange under the symbol BXE.
