Warren Resources, Inc. Enters into Credit Agreement
May 26 15
On May 22, 2015, Warren Resources Inc. entered into a Credit Agreement by and among the company, Wilmington Trust, National Association, as Administrative Agent, GSO Capital Partners LP, as Sole Lead Arranger and Sole Book runner, and the lenders from time to time a party thereto. The Credit Agreement provides for a five-year, $250 million term loan facility that matures on May 22, 2020. At the closing of the Credit Facility, certain of the lenders extended credit in the form of new term loans in the amount of $172.5 million and in the form of commitments for delayed draw term loans for up to an additional $30 million, subject to certain incurrence tests. In addition, certain of the lenders exchanged approximately $69.6 million of the company's previously issued 9.000% Senior Notes due 2022 at a discount for approximately $47.2 million of first lien term loans. The Credit Facility is subject to prepayment in respect of asset sales, subject to limited reinvestment rights and certain excluded asset sales, provided that the commitments for delayed draw term loans shall be increased by the amount of the net proceeds of certain sales of the company's oil and gas properties in excess of $25 million. The Credit Facility is guaranteed by Warren Resources of California Inc., Warren E&P Inc. and Warren Marcellus LLC, which are three of the company's wholly-owned subsidiaries (the Guarantors). The Credit Facility is secured by substantially all of the oil and gas assets of the Company and the Guarantors. The Credit Facility is also secured by all of the equity interests in the Guarantors. Certain third party swap and derivative transactions may be secured pursuant to an inter creditor agreement on a pari passu basis with the same collateral securing the Credit Facility. Proceeds from the new term loans under the Credit Facility were used to repay in full the company's existing indebtedness under its Third Amended and Restated Credit Agreement with Bank of Montreal, as Administrative Agent, and the lenders party thereto (the 2014 Facility), to pay certain fees and expenses and for working capital. Proceeds of the new term loans and the delayed draw term loans under the Credit Facility may be used from time to time for working capital, capital expenditures, repayment of outstanding debt, acquisitions and other general corporate purposes. The annual interest rate on borrowings under the Credit Facility will be 8.5% plus LIBOR for the applicable LIBOR period (with a minimum LIBOR rate of 1%).
Warren Resources, Inc. Reports Unaudited Earnings and Production Results for the First Quarter Ended March 31, 2015; Reports Impairment for the First Quarter Ended March 31, 2015; Provides Production Guidance for Second Quarter Ending June 30, 2015 and Full Year Ending December 31, 2015
May 7 15
Warren Resources Inc. reported unaudited earnings and production results for the first quarter ended March 31, 2015. For the quarter, the company reported net loss of $102.3 million or $1.26 per basic and diluted share, which includes a non-cash ceiling test write-down of its oil and gas properties totaling $91.4 million. This compares to net income of $8.2 million or $0.11 per basic and diluted share reported in the first quarter of 2014. Adjusted net loss was $10.9 million compared to adjusted net income of $7.9 million in the first quarter of 2014. Revenue from oil and gas sales decreased $8.3 million to $24.6 million, which represents a 25% decrease versus $32.9 million for the same quarter in 2014. Total revenues were $25,778,000 against $34,202,000 a year ago. Loss from operations was $100,892,000 against income from operations of $9,815,000 a year ago. Loss before taxes was $102,279,000 against income before taxes of $8,202,000 a year ago. Net cash provided by operating activities was $5,992,000 against $15,491,000 a year ago. LBITDA was $79,857,000 against EBITDA of $19,307,000 a year ago. The company's capital expenditures totaled $6.3 million in the Marcellus and capital expenditures for the Wilmington Field were $0.5 million.
Net oil production for the three months ended March 31, 2015 and 2014 was 262 Mbbls and 276 Mbbls, respectively. For the quarter, net gas production was 5.9 Bcf compared with 1.6 Bcf in the prior year. This increase in gas production reflects an additional 4.6 Bcf of gas produced from recently acquired Marcellus Assets.
The company recorded an impairment of $91.4 million at March 31, 2015 relating to its ceiling test write down of oil and gas properties.
The company provided production guidance for second quarter ending June 30, 2015 and full year ending December 31, 2015. For the second quarter, the company expects production of oil of 235 MBbl to 255 MBbl, gas of 7,000 MMcf to 8,000 MMcf, oil equivalent of 1,402 MBoe to 1,588 MBoe and gas equivalent 8,410 MMcfe to 9,530 MMcfe.
For the full year, the company expected production of oil of 900 MBbl to 1,000 MBbl, gas of 28,000 MMcf to 30,000 MMcf, oil equivalent of 5,567 MBoe to 6,000 MBoe and gas equivalent 33,400 MMcfe to 36,000 MMcfe.