Kerman & Co advises LGO Energy plc on its US$25 million long-term oil swap agreement with BNP Paribas

Posted By Keith Dempster

24 February 2015

Kerman & Co is pleased to have advised Goudron E&P Limited (“Goudron”), a wholly owned subsidiary of AIM listed client LGO Energy plc, on a US$25m pre-paid oil swap facility agreement with BNP Paribas to fund the ongoing development drilling program in the Goudron field in Trinidad.

The BNP Paribas facility is a pre-paid oil production swap and has been structured to allow repayment via future sales of oil. The funds advanced by BNP Paribas will be used predominantly by Goudron and for other limited corporate working capital purposes.

The first tranche of this new facility, estimated at US$12 million, will have a 30 month duration and a 6 month repayment holiday. The initial tranche of the facility will fund the planned 2015 drilling of at least seven development wells at the Goudron field.

Keith Dempster a partner in the corporate finance team at Kerman & Co led the transaction and commented: "By using a sophisticated transaction structure, the company is able to raise finance in a cost effective way during a challenging period for the sector.”  

Philip Olm and David Tink also assisted on this transaction.