(Updates throughout)
By Nina Chestney
June 14 (Reuters) - Britain's largest shale gas developerIGas said on Tuesday it is in talks with a number ofpotential investors to strengthen its balance sheet.
IGas has been cutting its debt over the last 14 months amidoil price volatility through bond buybacks and the amortisationof secured bonds, it said in a company update.
It has been also been in discussions with bondholders aboutextending debt maturity, deferring certain interest payments andwaivering some financial obligations on the expectation thatfurther finance is generated for the business.
"In relation to these financing requirements, the company isin discussions with a number of potential investors andcontinues to evaluate options for cash and earnings accretivetransactions including farm-outs and other asset portfoliomanagement opportunities," IGas said in a statement.
IGas shares fell by almost 10.5 percent to 15.40 pence by0853 GMT.
More capital could enable the firm to potentially increaseproduction by around 700 barrel of oil equivalent per day(beopd), net of decline, by Jan. 2018, the firm said.
It maintained its production guidance for the full year atbetween 2,500 and 2,700 boepd. As the oil price has improved toaround $50 a barrel since a low of around $27 a barrel inJanuary this year, IGas expects its operating costs for thisyear to be around $30 per barrel of oil equivalent.
IGas added that it is making good progress on its five-yearshale development plan, aiming to start drilling at two wells inthe first half of 2017, subject to planning and permitting. (Reporting by Nina Chestney, editing by Louise Heavens)
