W&T Offshore aims to manage debt by borrowing only for acquisitions

By Sahara Marte

New York, June 26 - W&T Offshore, Inc. plans to pursue oil and gas exploration opportunities, while maintaining a manageable debt level, Tracy Krohn, chief executive officer, said during the Global Hunter Securities energy conference.

"We don't borrow money to drill with; we will borrow money to make acquisitions," he added. "The idea is to continue to improve those credit ratings as we go forward and you can't do that if you pick up too much debt."

W&T Offshore has a revolver with a $650 million borrowing base that matures in 2015. It currently has $53 million drawn on the revolver and a cash balance of $24.3 million.

Due to its "successful" acquisitions, W&T Offshore has been able to consistently pay dividends for the last five years with a 2011 yield of 3.7%, Krohn said.

The company continues to develop existing assets, including projects in the Gulf of Mexico where the majority of its cash flow comes from. Rising oil and natural gas production will continue to boost earnings going forward, Krohn said.

W&T Offshore's revenues for 2011 were $971 million. Adjusted EBITDA grew 44% to $646 million.

W&T is a Houston-based independent oil and natural gas producer.

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