|
For Release at 8:00 AM EST on Thursday, March
8, 2007
Gasco Energy Announces
Increased Borrowing Base on Revolving Line of Credit
DENVER – (PR Newswire) – March 8, 2007 – Gasco
Energy, Inc. (AMEX: GSX) today announced that it has
received a re-determination of its borrowing base under
its $250 million revolving line of credit agreement
led by JPMorgan. The borrowing base, reflecting
the maximum amount that may be outstanding under the
credit facility at any time, is increased to $37 million
from $25 million at the previous re-determination in
fall 2006. The borrowing base is determined by
reference to Gasco’s proved reserves at December
31, 2006. Loans made under this revolving credit
agreement are secured by a pledge of the capital stock
of Gasco's significant subsidiaries, guaranties by
Gasco’s significant subsidiaries, and mortgages
on substantially all of the Company’s oil & gas
properties.
Each loan bears interest at a Eurodollar rate or a
base rate, as requested by Gasco, plus an applicable
percentage based on Gasco's usage of the facility. The
applicable margin above the Eurodollar rate ranges
from 1.25% to 2.00% depending on the Company’s
usage under the credit line. In addition, under
the terms of the $250 million credit agreement, Gasco
pays a commitment fee quarterly in arrears based on
a percentage multiplied by the daily amount that the
aggregate commitments exceed borrowings under the agreement. Gasco
did not borrow any funds at the time of execution of
the credit agreement. For further detail please
refer to Gasco’s disclosure on Form 8-K filed
today with the SEC.
The credit facility is available to provide funds
for the exploration, development and/or acquisition
of oil and gas properties, to refinance existing indebtedness
and for working capital and other general corporate
purposes. Interest on funds drawn will be paid monthly
with the principal due March 2010. The agreement provides
for semi-annual evaluation of the borrowing base, which
will be determined as a percentage of the discounted
present value of the Company’s oil and natural
gas reserves.
“Borrowing capacity under our revolving line
of credit adds additional flexibility to our growth
capital needs,” said King Grant, Gasco’s
Chief Financial Officer. “With this credit
facility, which is tied to our reserve base, we are
further capable of funding our drilling & completion
plans on lower-risk, development projects in our Riverbend
project in Utah. Cash on hand, cash flow generated
from our producing wells and our ability to borrow
under this credit facility are expected to allow Gasco
to successfully fund its previously announced $40 million
2007 drilling program.”
About Gasco Energy
Gasco
Energy, Inc. is a Denver-based natural gas and oil
exploitation and development company that focuses
on natural-gas-rich prospects in the Rocky Mountain
area of the United States. The Company
currently is active in the Uinta Basin in Utah and
controls acreage in the Greater Green River Basin
of Wyoming. To learn more, visit www.gascoenergy.com.
Forward-looking statements
Certain
statements set forth in this press release relate
to management’s future plans, objectives
and expectations. Such statements are forward-looking
within the meanings of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. All statements
other than statements of historical facts included
in this press release, including, without limitation,
statements regarding the Company’s future financial
position, potential resources, business strategy,
budgets, projected costs and plans and objectives
of management for future operations, are forward-looking
statements. In addition, forward-looking statements
generally can be identified by the use of forward-looking
terminology such as “may,” “will,” “expect,” “intend,” “project,” “estimate,” “anticipate,” “believe,” or “continue” or
the negative thereof or similar terminology. Although
any forward-looking statements contained in this
press release are to the knowledge or in the judgment
of the officers and directors of the Company, believed
to be reasonable, there can be no assurances that
any of these expectations will prove correct or that
any of the actions that are planned will be taken. Forward-looking
statements involve known and unknown risks and uncertainties
that may cause the Company’s actual performance
and financial results in future periods to differ
materially from any projection, estimate or forecasted
result. Some of the key factors that may cause
actual results to vary from those the Company expects
include inherent uncertainties in interpreting engineering
and reserve or production data; operating hazards;
delays or cancellations of drilling operations because
of weather and other natural and economic forces;
fluctuations in oil and natural gas prices in response
to changes in supply; competition from other companies
with greater resources; environmental and other government
regulations; defects in title to properties; increases
in the Company’s cost of borrowing or inability
or unavailability of capital resources to fund capital
expenditures; and other risks described under “Risk
Factors” in Item 1. of the Company’s
2006 filing on Form 10-K filed with the Securities
and Exchange Commission on February 28, 2006.
Contact for Gasco Energy, Inc.: Investor Relations:
303-483-0044
|
