PEDEVCO Announces Closing of $250 Million Reserve Based Lending Facility with Citibank, N.A.

Rhea-AI Summary

PEDEVCO Corp. (NYSE American:PED) has successfully closed a new $250 million reserve based lending facility (RBL) with Citibank, N.A. as the administrative agent. The facility has a four-year maturity and provides an initial borrowing base of $20.0 million. PEDEVCO has not drawn any borrowings yet. The company's president, J. Douglas Schick, expressed satisfaction with the partnership, stating that the RBL, combined with their existing $10 million cash on hand and strong cash flow, is expected to provide ample capital for accelerated development of their D-J Basin and Permian Basin assets, as well as funding for potential asset acquisitions and strategic transactions.

Positive

• Secured a $250 million reserve based lending facility with Citibank, N.A.
• Initial borrowing base of $20.0 million
• Four-year maturity on the lending facility
• Over $10 million cash on hand reported
• Strong cash flow mentioned by company president

Negative

• None.

Insights

Financial Analyst

The closing of PEDEVCO's $250 million RBL facility with Citibank is a significant financial milestone. With an initial borrowing base of $20 million and a four-year maturity, this facility provides substantial financial flexibility. The company's strong cash position of over $10 million, combined with the new credit line, positions PEDEVCO for accelerated growth in the D-J and Permian Basins. This financial arrangement could be a game-changer for PEDEVCO's expansion strategy, potentially leading to increased production and reserves. However, investors should note that the company hasn't drawn from the facility yet, indicating a cautious approach to leverage. The partnership with Citibank also lends credibility to PEDEVCO's operations and future prospects.

Oil & Gas Industry Expert

PEDEVCO's new RBL facility is a strategic move in the current oil and gas landscape. The $250 million ceiling demonstrates confidence in the company's asset base and growth potential. This facility provides PEDEVCO with the financial firepower to accelerate development in two key U.S. oil basins: the D-J and Permian. These regions are known for their high-quality reserves and favorable economics. The mention of "dry powder" for opportunistic acquisitions is particularly intriguing, as it suggests PEDEVCO may be eyeing strategic expansions in a market where some players might be distressed. However, execution will be key and investors should watch for how effectively the company deploys this capital to drive production growth and reserve additions.

Market Research Analyst

PEDEVCO's new credit facility could significantly alter its market position. The $250 million ceiling is substantial for a company of PEDEVCO's size, potentially allowing it to punch above its weight in terms of development and acquisitions. This move comes at a time when many smaller oil and gas companies are struggling to secure financing, giving PEDEVCO a competitive edge. The partnership with Citibank may also improve PEDEVCO's standing among investors, potentially leading to improved liquidity and valuation. However, the energy sector remains volatile and PEDEVCO will need to navigate market uncertainties carefully. Investors should monitor how this facility impacts PEDEVCO's growth trajectory and financial metrics, particularly its debt-to-equity ratio and return on invested capital.

HOUSTON, TX / ACCESSWIRE / September 11, 2024 / PEDEVCO Corp. (NYSE American:PED) ("PEDEVCO" or the "Company") is pleased to announce the successful closing of a new $250 million reserve based lending facility ("RBL" or "Facility") among Citibank, N.A., as administrative agent, and the lenders (including Citibank, N.A.) from time to time party thereto. The Facility has a maturity of four years and provides for an initial borrowing base of $20.0 million and an aggregate maximum revolving credit amount of $250 million. The Company has not drawn down any borrowings under the Facility at this time.

J. Douglas Schick, President of the Company, stated, "We are very pleased to announce the closing of our RBL with Citibank, a strong and reputable banking partner. The funds available for borrowing under the RBL, together with our over $10 million of cash on hand and strong cash flow, are anticipated to provide the Company with ample capital and "dry powder" to fuel the expected accelerated development of our D-J Basin and Permian Basin assets, as well as to provide funding for opportunistic asset acquisitions and strategic transactions that may arise."

About PEDEVCO Corp.

PEDEVCO is a publicly-traded energy company engaged in the acquisition and development of strategic, high growth energy projects in the United States. The Company's principal assets are its San Andres Asset located in the Northwest Shelf of the Permian Basin in eastern New Mexico, and its D-J Basin Asset located in the D-J Basin in Weld and Morgan Counties, Colorado and Southeastern Wyoming. PEDEVCO is headquartered in Houston, Texas. More information about PEDEVCO can be found at www.pedevco.com.

Cautionary Statement Regarding Forward Looking Statements

This press release may contain forward-looking statements, including information about management's view of PEDEVCO's future expectations, plans and prospects, within the meaning of the federal securities laws, including the safe harbor provisions under The Private Securities Litigation Reform Act of 1995 (the "Act"). In particular, when used in the preceding discussion, the words "may," "could," "expect," "intend," "plan," "seek," "anticipate," "believe," "estimate," "predict," "potential," "continue," "likely," "will," "would" and variations of these terms and similar expressions, or the negative of these terms or similar expressions are intended to identify forward-looking statements within the meaning of the Act and such laws, and are subject to the safe harbor created by the Act and applicable laws. Any statements made in this news release other than those of historical fact, about an action, event or development, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors, which may cause the results of PEDEVCO and its subsidiaries to be materially different than those expressed or implied in such statements. The forward-looking statements include projections and estimates of the Company's corporate strategies, future operations, development plans and programs, including the costs thereof, drilling locations, estimated oil, natural gas and natural gas liquids production, price realizations, projected operating, general and administrative and other costs, projected capital expenditures, efficiency and cost reduction initiative outcomes, statements regarding future production, costs and cash flows, liquidity and our capital structure. We have based these forward-looking statements on our current expectations and assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. However, whether actual results and developments will conform with our expectations and predictions is subject to a number of risks and uncertainties, including the volatility of oil and natural gas prices, our success in discovering, estimating, developing and replacing oil and natural gas reserves, risks of our operations not being profitable or generating sufficient cash flow to meet our obligations; risks relating to the future price of oil, natural gas and NGLs; risks related to the status and availability of oil and natural gas gathering, transportation, and storage facilities; risks related to changes in the legal and regulatory environment governing the oil and gas industry, and new or amended environmental legislation and regulatory initiatives; risks relating to crude oil production quotas or other actions that might be imposed by the Organization of Petroleum Exporting Countries and other producing countries; technological advancements; changing economic, regulatory and political environments in the markets in which the Company operates; general domestic and international economic, market and political conditions, including the military conflict between Russia and Ukraine and the global response to such conflict; actions of competitors or regulators; the potential disruption or interruption of the Company's operations due to war, accidents, political events, severe weather, cyber threats, terrorist acts, or other natural or human causes beyond the Company's control; risks related to the need for additional capital to complete future acquisitions, conduct our operations, and fund our business on favorable terms, if at all, the availability of such funding and the costs thereof; risks related to the limited control over activities on properties we do not operate and the speculative nature of oil and gas operations in general; risks associated with the uncertainty of drilling, completion and enhanced recovery operations; risks associated with illiquidity and volatility of our common stock, dependence upon present management, the fact that Dr. Simon G. Kukes, our CEO and member of the Board, beneficially owns a majority of our common stock; our ability to maintain the listing of our common stock on the NYSE American; pandemics, governmental responses thereto, economic downturns and possible recessions caused thereby; inflationary risks and recent increased interest rates, and the risks of recessions and economic downturns caused thereby or by efforts to reduce inflation; risks related to military conflicts in oil producing countries; changes in economic conditions; limitations in the availability of, and costs of, supplies, materials, contractors and services that may delay the drilling or completion of wells or make such wells more expensive; the amount and timing of future development costs; the availability and demand for alternative energy sources; regulatory changes, including those related to carbon dioxide and greenhouse gas emissions; and others that are included from time to time in filings made by PEDEVCO with the Securities and Exchange Commission, many of which are beyond our control, including, but not limited to, in the "Risk Factors" and "Cautionary Note Regarding Forward-Looking Statements" sections of its Form 10-Ks and Form 10-Qs and in its Form 8-Ks, which it has filed, and files from time to time, with the U.S. Securities and Exchange Commission, including, but not limited to its Annual Report on Form 10-K for the year ended December 31, 2023 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2024. These reports are available at www.sec.gov.

The Company cautions that the foregoing list of important factors is not complete. All subsequent written and oral forward-looking statements attributable to the Company or any person acting on behalf of the Company are expressly qualified in their entirety by the cautionary statements referenced above. Other unknown or unpredictable factors also could have material adverse effects on PEDEVCO's future results and/or could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements. The forward-looking statements included in this press release are made only as of the date hereof. PEDEVCO cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. We undertake no obligation to update publicly any of these forward-looking statements to reflect actual results, new information or future events, changes in assumptions or changes in other factors affecting forward-looking statements, except to the extent required by applicable laws. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.

CONTACT:

PEDEVCO Corp.
(713) 221-1768
PR@pedevco.com

SOURCE: PEDEVCO Corp.

View the original press release on accesswire.com

FAQ

What is the size of PEDEVCO's new reserve based lending facility?

PEDEVCO (PED) has secured a $250 million reserve based lending facility with Citibank, N.A.

What is the initial borrowing base for PEDEVCO's new RBL?

The initial borrowing base for PEDEVCO's (PED) new reserve based lending facility is $20.0 million.

How long is the maturity period for PEDEVCO's new lending facility?

PEDEVCO's (PED) new reserve based lending facility has a maturity period of four years.

Has PEDEVCO drawn any borrowings from the new facility as of September 11, 2024?

As of September 11, 2024, PEDEVCO (PED) has not drawn any borrowings from the new $250 million reserve based lending facility.

What assets does PEDEVCO plan to develop with the new funding?

PEDEVCO (PED) plans to use the new funding to accelerate development of its D-J Basin and Permian Basin assets.