Lonestar Resources (LONE) - Update June 17

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dan_s
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Lonestar Resources (LONE) - Update June 17

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FORT WORTH, Texas, June 17, 2019 /PRNewswire/ -- Lonestar Resources US Inc. (LONE) (together with its subsidiaries, "Lonestar") announced today an increase in its borrowing base and the addition of crude oil and natural gas hedges for 2020 and 2021.

Citibank NA, as agent for Lonestar's Senior Secured Credit Facility (the "Facility"), informed the Company that the bank group has approved an increase in the Borrowing Base from $275 million to $290 million. At March 31, 2019, Lonestar had $194 million drawn on the Facility. Notably, the increase in the Borrowing Base came despite a significant decrease in the bank price deck.

Keep in mind that Lonestar sells 100% of its' physical oil at LLS prices; about a $6/bbl premium to WTI.

Lonestar has also added to its hedge positions for 2020 and 2021. Giving effect for these new hedges, Lonestar's crude oil and natural gas positions stand as follows:

For remainder of 2019, the Company has approximately 6,800 barrels per day of West Texas Intermediate crude oil swaps and collars at an average price of $54.30 per barrel, which represents approximately 90% of 2019 crude oil production.1

For calendar 2020, the Company has approximately 6,480 barrels per day of West Texas Intermediate crude oil swaps and collars at an average price of $57.04 per barrel, which represents approximately 80% of 2020 crude oil production.1

For calendar 2021, the Company has approximately 3,000 barrels per day of West Texas Intermediate crude oil swaps and collars at an average price of $54.68 per barrel, which represents approximately 35% of 2021 crude oil production. 1

For the remainder of 2019, the Company has approximately 15,000 MMBTU/day of Henry Hub natural gas swaps at an average price of $2.81 per MMBTU, which represents approximately 68% of 2019 natural gas production. 1

For calendar 2020, Lonestar entered into approximately 15,000 MMBTU/day of Henry Hub natural gas swaps at an average price of $2.59 per MMBTU which represents approximately 51% of 2020 natural gas production. 1

Lonestar's Chief Executive Officer, Frank D. Bracken, III, commented, "The increase in our Borrowing Base provides another increase in liquidity for Lonestar as well as confirmation of continued performance of our producing asset base. Additionally, we have strategically added to our crude oil and natural gas hedge positions to create extremely high levels of commodity price protection through 2020. Our augmented hedge position provides a high degree of price certainty for Lonestar for the next two years, and in combination with the continued outstanding performance of our capital program, are expected to generate outstanding returns for our shareholder and are projected to yield significant increases in production and EBITDAX while establishing cash flow self-sufficiency in the second half of 2019 and beyond."
Dan Steffens
Energy Prospectus Group
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