Orion Oil & Gas Corporation
TSX : OIP

March 28, 2011 09:29 ET

Orion Announces $120 Million Syndicated Credit Facilities

CALGARY, ALBERTA--(Marketwire - March 28, 2011) - Orion Oil & Gas Corporation ("Orion" or the "Company") (TSX:OIP) announces that it has secured a $60 million increase in its credit facility. Orion's existing credit facility will be replaced with a new syndicated credit facility and an operating facility in an aggregate principal amount of $120 million (together the "Credit Facilities"). 

The syndication of the Credit Facilities was led by TD Securities ("TD") and includes BNP Paribas (BNP"), The Bank of Nova Scotia ("BNS"), and Societe Generale ("SG"). The new Credit Facilities are comprised of a $100 million committed syndicated credit facility and a $20 million committed operating facility. Both are revolving facilities with term-out provisions with the initial revolving period ending on or about April 30, 2012. If the Credit Facilities are not renewed they will convert to 365-day term loans. The Credit Facilities will bear interest at the prime rate, bankers' acceptance rate or LIBOR plus a spread determined by Orion's debt-to-EBITDA ratio. The proceeds of the Credit Facilities may be used for general corporate purposes, including working capital and acquisitions. 

"We are very pleased to have executed a significant increase in our Credit Facilities. The confidence and support shown by TD, BNS, BNP, and SG is a testament to the progress we have made thus far and we look forward to strengthening our relationship with our new partners," said Gary Guidry, President and Chief Executive Officer of Orion. "These Credit Facilities, combined with our free funds flow from operations, ensure that we have the financial capability required to support our strategic plan." 

Summary Information Relating to Orion

Orion is engaged in the exploration for and development of oil and natural gas interests located primarily in the Kaybob, Redwater and Bigstone areas of Alberta. Orion is operator at its Kaybob, Redwater and Bigstone properties.

Cautionary Statements

Certain information contained in this press release constitutes forward-looking information or statements including, without limitation, information and statements respecting: anticipated cash flow, future investment objectives, anticipated oil and gas pricing, expected inflation and future foreign exchange rates. Statements relating to "reserves" and "resources" are forward-looking information as they involve the implied assessment, based on certain estimates and assumptions that, among others, the reserves and resources described exist in the quantities predicted or estimated. Forward-looking information and statements are often, but not always, identified by the use of words such as "anticipate", "seek", "believe", "expect", "hope", "plan", "intend", "forecast", "target", "project", "guidance", "may", "might", "will", "should", "could", "estimate", "predict" or similar words or expressions suggesting future outcomes or language suggesting an outlook. By their very nature, forward-looking information and statements involve inherent risks and uncertainties, both general and specific, and risks that predictions, forecasts, projections and other forward-looking information and statements will not be achieved. We caution readers not to place undue reliance on these statements as a number of important factors could cause the actual results to vary materially from the forward-looking information or statements. These factors include, but are not limited to: the volatility of oil and gas prices; production and development costs; capital expenditures; the imprecision of reserve and resource estimates and estimates of recoverable quantities of oil, natural gas and liquids; the Company's ability to replace and expand oil and gas reserves; environmental claims and liabilities; incorrect assessments of value when making acquisitions or dispositions; increases in debt service charges; the loss of key personnel; the marketability of production; defaults by third party operators; unforeseen title defects; fluctuations in foreign currency and exchange rates; inadequate insurance coverage; compliance with environmental laws and regulations; changes in tax and royalty laws; the Company's ability to access external sources of debt and equity capital; and the Company's ability to obtain equipment in a timely manner to carry out development activities. Further information regarding these factors may be found under the headings "Risk Factors" and "Industry Conditions" in the Company's most recent Annual Information Form available under the Company's profile on SEDAR (www.sedar.com).

Readers are cautioned that the foregoing list of factors that may affect future results is not exhaustive. When relying on our forward-looking statements to make decisions with respect to the Company, investors and others should also carefully consider information set forth in the section "Forward-Looking Statements" of the Company's most recent Annual Information Form respecting the assumptions upon which the Company bases certain forward-looking information and the uncertainties inherent in such assumptions. The Company does not assume responsibility for the accuracy and completeness of the forward-looking information or statements and such information and statements should not be taken as guarantees of future outcomes. Subject to applicable securities laws, the Company does not undertake any obligation to revise these forward-looking information or statements to reflect subsequent events or circumstances. Furthermore, the forward-looking information contained in this press release are made as of the date of this document and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. The forward-looking information and statements contained in this press release are expressly qualified by this cautionary statement.

This press release uses the terms "funds flow from operations" and "EBITDA" which are not recognized under Canadian generally accepted accounting principles ("GAAP") and may not be comparable to similar measures presented by other companies. The Company considers funds flow from operations a key performance measure as it demonstrates the Company's ability to generate funds necessary to repay debt and to fund future growth through capital investment. Funds flow from operations should not be considered an alternative to, or more meaningful than, cash flow from operating activities as determined in accordance with GAAP. Funds flow from operations is calculated as cash flow from operating activities before adjusting for changes in non-cash working capital. EBITDA is calculated as net income plus interest expense, income taxes, depreciation and amortization, other non-cash items, and extraordinary and non-recurring losses, less extraordinary and non-recurring gains.

Contact Information

  • Orion Oil & Gas Corporation
    Gary Guidry
    President and Chief Executive Officer
    (403) 297-1430
    (403) 237-9791 (FAX)
    or
    Orion Oil & Gas Corporation
    Douglas Allen
    Chief Financial Officer
    (403) 297-1430
    (403) 237-9791 (FAX)
    or
    Orion Oil & Gas Corporation
    Trevor Peters
    Vice President, Business Development and Corporate Planning
    (403) 297-1430
    (403) 237-9791 (FAX)
    www.orionoilandgas.ca