EP Energy temporarily suspends one maximum ratio, pricing increased

By Wendy Van Sickle

Columbus, Ohio, May 4 – EP Energy Corp. wholly owned subsidiary EP Energy LLC entered into an amendment Monday that temporarily suspended the maximum consolidated total debt to EBITDAX ratio under its reserve-based loan credit facility and replaced it with a maximum first-lien debt to EBITDAX ratio.

Specifically, the maximum total debt to EBITDAX ratio of 4.5 times was suspended until March 31, 2018 and replaced with a maximum first-lien debt to EBITDAX ratio of 3.5 times, according to an 8-K filing with the Securities and Exchange Commission.

The company’s debt buybacks during that period are also capped at $350 million.

Additionally, the interest rate for loans under the facility was increased by 100 basis points.

In connection with the amendment, the borrowing base and commitments under the facility were reduced to $1.65 billion from $2.75 billion, after giving effect to the April redetermination and the $420 million sale of some assets located in the Haynesville and Bossier shales owned by some EP subsidiaries to Covey Park Gas LLC.

EP Energy is a Houston-based oil and natural gas exploration and production company.

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