Hess enters into $3.5 billion four-year revolving credit facility

By Sarah Lizee

Olympia, Wash., April 23 – Hess Corp. entered into a credit agreement on April 18 with JPMorgan Chase Bank, NA as administrative agent, providing for an up to $3.5 billion revolver, according to an 8-K filing with the Securities and Exchange Commission.

The credit agreement provides for commitments in the form of committed revolving loans or uncommitted competitive loans, in the form of swingline loans not to exceed $400 million, of which $274 million was committed at close, and letters of credit not to exceed $2 billion, of which $875 million was committed at close.

Borrowings bear interest at Libor plus 90 basis points to 177.5 bps, depending on the company’s debt ratings.

The facility fee ranges from 10 bps to 35 bps and also depends on ratings.

The revolver may be increased by up to an additional $1 billion under some circumstances.

The credit agreement expires on May 15, 2023, unless extended.

The credit agreement replaces the company’s existing five-year credit agreement dated Jan. 21, 2015 with JPMorgan as administrative agent, which was terminated.

A financial covenant limits the ratio of total consolidated debt to total capitalization of the company and its consolidated subsidiaries to 0.65 to 1.00.

JPMorgan, MUFG Bank, Ltd., Mizuho Bank, Ltd., Goldman Sachs Bank USA and Morgan Stanley Senior Funding, Inc. are joint lead arrangers and bookrunners. MUFG, Mizuho, Goldman and Morgan Stanley are syndication agents. BMO Harris Bank, NA, BNP Paribas, Citibank, NA, Sumitomo Mitsui Banking Corp., Bank of Nova Scotia, Houston Branch, Toronto-Dominion Bank, New York Branch and Wells Fargo Bank, NA are documentation agents.

Hess is a New York-based independent oil and gas producer.

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