MedcoEnergi signs $200m loan agreement

IDX-listed energy firm PT Medco Energi Internasional Tbk, through its subsidiary PT Medco E&P Tomori Sulawesi (together called MedcoEnergi), has signed a Term Facility Agreement on Tuesday with PT Bank ANZ Indonesia, PT Bank DBS Indonesia, PT Bank Mandiri (Persero) Tbk, Standard Chartered Bank (SCB) and Sumitomo Mitsui Banking Corporation (SMBC) to refinance an upstream gas operations in Senoro Field, Senoro-Toili PSC Block, Central Sulawesi.

?All those five prominent banks acted as Joint Mandated Lead Arrangers for a Term Facility (with SCB acting as Global Coordinator) in the amount of US$200 million,? Medco said in a statement Monday.

The company said with MedcoEnergi's credit standing, the banks were able to secure initial commitments for the Term Facility in the amount of $350 million. Nonetheless, MedcoEnergi opted to execute a Term Facility in the amount of $200 million, which demonstrated a 1.75x over subscription.

Since April 2015, when the gas production facilities reached its mechanical completion, the Senoro Upstream Gas has exhibited a steady ramp up gas production and the facilities currently produces gas above its daily contractual obligation of 250 MMSCF per day. The cumulated gas production is targeted at 69,440 BBTU by end of 2015.

To date, the gas has been sent to PT Donggi Senoro LNG (DSLNG), a joint venture company of MedcoEnergi, PT Pertamina (Persero), Mitsubishi and Kogas, for LNG production. Up to now DSLNG has shipped 9 LNG cargoes and it expects to ship a total of 12 cargoes by year end of 2015.

Lukman Mahfoedz, President Director & CEO of MedcoEnergi stated: "This agreement indeed reflects a good standing credit reputation of the company whereby we can still secure funding amidst the current low oil price. This refinancing will accumulatively contribute to a total of $600 million fund raising exercise in 2015 for the purpose of general capital investment and refinancing of MedcoEnergi?s indebtedness.?

Editing by Reiner Simanjuntak