Deepwater Portfolio Expansion and Upside Potential
MUNICH RE TRANSACTION OVERVIEW
.
•
•
.
Partnered with Munich Re, a reputable AA-rated counter-party,
to fund future growth needs
Increased cash on hand with non-recourse financing
Leverage-neutral transaction in non-recourse SPV structure
No maintenance covenants or redetermination requirements and no
covenants at the parent level or recourse to any other assets of parent
Term loan interest rate of 7% is at a substantially lower level
compared to recent GOM high yield deals
Mandatory amortization over 7 years supports deleveraging
Executed natural gas derivatives contracts through term of loan to cover
debt service
CORPORATE STRUCTURE
Prior to
1
Transaction
Mobile Bay
Area Assets
Only cash flows from the Mobile Bay area asset will be used to service the
term loan debt going forward
Post
2
Transaction
.
W&T owns 100% of the equity in the SPVS
NEW
1L TL
100%
.
Keeps all cash flows associated with the Mobile Bay area assets after debt
service and reserves
Adds cash to the balance sheet to reinvest in accretive acquisitions or other
accretive drilling opportunities
Keeps future drilling opportunities
• On a consolidated basis, all earnings and debt are reported at the
W&T level, public filings will reflect all activity for W&T and the SPVs
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W&T OFFSHORE | NYSE:WTI
W&T
(PubCo)
100%
W&T
(PubCo)
RBL
2L Notes
Other Gulf of
Mexico Assets
100%
RBL
2L Notes
SPVs
Mobile Bay
Area Assets
Other Gulf of
Mexico Assets
Boosted Cash and Allowed Repayment of the RBL Facility
☑
No Cross Collateralization
☑
W&T OFFSHOREView entire presentation