Changes to a new lending program from the Federal Reserve have paved the way for the oil and gas industry to get government financing amid the pandemic. The expanded criteria to qualify for the soon-to-be Main Street Lending Program follows requests from Sen. Ted Cruz (R-Texas) and an industry group for small and mid-sized oil producers who said financing was needed to save the industry from bankruptcy. Companies with 15,000 employees or $5 billion in annual revenue will now qualify, up from 10,000 employees and $2.5 billion in revenue. The minimum loan size ranges from $500,000 to $1 million.
Maximum loan totals under the Main Street program are also being hiked to $200 million -- from an earlier $150 million cap viewed as too low to help oil producers.
“Great news out of the Fed today in support of struggling U.S. energy companies,” Energy Secretary Dan Brouillette said in a tweet Thursday. He added that he would “continue” his work with Treasury Secretary Steven Mnuchin to provide “other relief” to the industry.
GREAT NEWS: The guidelines released Thursday eased restrictions on borrowing for heavily indebted companies and also allows them to use the loans to refinance existing debts — a departure from the first set of criteria released by the board.
https://www.worldoil.com/news/2020/5/1/ ... les-change
Fed loan program for oil & gas companies - May 1
Fed loan program for oil & gas companies - May 1
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group