Energi Mega plans debt to equity swap

IDX-listed upstream company PT Energi Mega Persada said it plans to launch a debt to equity swap this year in a bid to reduce its debts owed to key lenders.

Energi Mega Chief Investor Relations, Herwin Hidayat said on Tuesday that the company was seeking to convert US$320 million worth of debts owed to five lenders including Pro Strategic Investor Ltd, Sintesa Sanpaolo, PST Finance, Bank of America Merril Lynch, Mitsubishi Corporation, and Japan Petroleum Exploration Ltd.

In 2013, the company?s total debts stood at $700 million, compared to $320 million as per the third quarter of this year.

Herwin said that the debt to equity swap will be a follow up of the upcoming reverse stock, which was finally approved by shareholders on Tuesday.

Energi Mega said in April that unaudited revenue last year fell by almost 20 percent to $500 million from $624 million in the previous year due to a combination of lower output and weak price environment. Oil and gas production last year reached 43,000 boepd, down from 46,600 boepd in 2015.

Average oil production last year stood at 8,700 bpd, of which more than 50 percent of the oil output came from Malacca and ONWJ blocks.

Average gas production last year was 200 mmscfd. Over 90 percent of the gas production came from three blocks, namely Kangean in East Java, Bentu in Sumatra, and ONWJ in West Java.

In a bid to maintain production level, Energi Mega this year plans to spend $114 million in capital expenditure, focusing its production operations at the Bentu and Kangean blocks as contract in ONWJ block has recently expired. (*)