Diversified Gas & Oil maintains borrowing base and costs

(Sharecast News) - Diversified Gas & Oil announced on Monday that its bank lending group, led by KeyBank National Association, has completed the semi-annual redetermination of its senior secured credit facility, and reaffirmed the existing $425m borrowing base.
The FTSE 250 firm said there were no changes to pricing, covenants or other material terms.

Following the redetermination, its liquidity was more than $220m, consisting of cash on hand and availability under the credit facility.

The company said its current net debt stood at $730m, with the ratio to adjusted EBITDA being 2.2x, which was lower than its stated internal threshold, and "well below" the debt covenant threshold.

"We are pleased that our strong production profile, robust hedging positions and long-life proved developed producing reserves support a unanimous reaffirmation of our borrowing base," said chief executive officer Rusty Hutson Jr.

"Recognising the challenging times in which we operate and against a backdrop of many borrowing base reductions, I would like to thank our bank group for their continued support of our differentiated business strategy.

"Evidenced by two consecutive dividend increases representing more than a 14% increase per share since the global pandemic began, our strategy remains highly resilient in the current commodity price environment."

At 0900 GMT, shares in Diversified Gas & Oil were up 0.35% at 111.19p.