This follows a pleasing response to the company’s financing investigations from a range of Australian and international banks.
As part of this process FAR has appointed Macquarie Bank Limited as an arranger of a debt facility to arrange and manage the syndication of the facility.
FAR managing director Cath Norman said, “On October 30, FAR released the economic data for the development of the world-class SNE oil field.
“SNE’s robust project economics, underpinned by attractive fiscal terms and an experienced offshore operator, has seen significant interest by banks over the last three months in providing a debt facility."
For some time FAR has been seeking the best debt financing solution for the company and this process has involved investigating a broad range of options.
The facility that Macquarie Bank will be seeking to arrange includes:
- Amount of up to US$350 million;
- 7-year term;
- All-in interest below 10% (margin + LIBOR) (payable on drawn funds);
- Commitment fee of 40% of margin (payable on undrawn funds); and
- Senior secured on FAR’s 13.67% interest in SNE with the support of a parent company guarantee from FAR Limited.
FAR is targeting binding and committed terms upon completion of each banks’ credit approval process on or before the end of 2019.
While there is substantial progress on the financing, no commitment to provide finance has been provided to date, and credit approval and underwriting from the banks has not yet been achieved.
Therefore, it is not certain that financing will proceed as outlined.