Oil and Gas News

Strike secures funding to progress Perth Basin portfolio

Strike Energy

Strike Energy has announced that it has secured an additional $20 million secured debt facility with Macquarie Bank to cover the development, and pre-development, of its high-quality Perth Basin gas projects.

This facility empowers Strike to continue its progress towards becoming a significant gas producer in Western Australia.

Reflecting the positive relationship between Macquarie and Strike, the capitalising interest of the facility, all outstanding funds are to be repaid on maturity in November 2023.

It will be supplied in two tranches of $10 million. The conditions of the first tranche mirror those attributed to Strike’s existing drawn debt with Macquarie.

The second $10 million is to be subject to approval, and will be used to cover Strike’s costs for bringing the Walyering gas project – partnered with Talon Energy – into production.

Strike has projected that, should the major financial decisions be finalised in the second half of 2022, and subject to Macquarie’s approvals, the total drawn debt may be used in a proposed project finance facility supported by production from the Walyering project, resulting in a more competitive cost of capital for a longer term.

In order to establish the new facility, Strike will issue Macquarie with 20.7 million options to subscribe For Strike’s ordinary shares with an exercise price of 34 cents. The options are to be issued at the close of the first tranche, outside of shareholder approval, and will expire in December 2024.

Strike is also looking at options for capital expenditure to come from within the corporately-structured Project Haber. Project equity sell down is the mechanism by which Strike intends to fund its contribution to construction.