Petroquest Energy Corp said the borrowing base under its credit facility has been revised to $100 million, following a redetermination by its lenders, and the independent oil and natural gas company raised its third-quarter production forecast.
The company said it currently has $100 million of borrowings outstanding on its revolving credit facility, and is in compliance with the financial covenants under the facility.
In March, the company entered into an amendment to its credit agreement, under which its borrowing base was cut to $130 million from $150 million.
Petroquest also raised its third-quarter production outlook to about 85 to 87 million cubic feet of natural gas equivalent per day (MMcfed) from its prior view of 80 to 85 MMcfed.
The company said it expects to drill two wells in the Woodford shale in Oklahoma during the fourth quarter of 2009.
We are now in position to re-initiate drilling activities and take advantage of a low service cost environment that will capture the anticipated higher commodity prices in 2010, Chief Executive Charles Goodson said.
A dip in demand for oil and natural gas due to the global economic slowdown led to a drop in prices. Lower commodity prices, in turn, brought down the costs of drilling wells, allowing producers to get more for their money, boosting many exploration and production companies' profits.
Petroquest shares closed at $6.49 Wednesday on the New York Stock Exchange. The stock has traded in the range of 61 cents to $15.35 over the past one year. (Reporting by Adveith Nair in Bangalore; Editing by Deepak Kannan)