CALGARY -- Ithaca Energy has agreed terms for conversion of a loan from Dyas relating to its UK North Sea properties.
Under a farm-in arrangement, Dyas agreed to loan the company $61.2 million last October to finance development of the Jacky and Beatrice fields in the central sector. Dyas had the option to convert this loan by November 2010 in return for an additional 15.15% of all of Ithaca’s interests.
Following early conversion of the loan, Ithaca will become debt-free and will receive a further payment from Dyas of $35.8 million. In exchange, Dyas will accept further equity in Ithaca’s production and exploration assets.
The total consideration for this revised transaction will be around $97 million.
Ithaca will use the new cash influx to enhance production from the Jacky and Beatrice areas; to appraise its Stella discovery; and to seek new E&P opportunities. The arrangement also reduces Ithaca’s interests ahead of major planned capital expenditure on the Stella and Carna prospects and the Beatrice area.