Santos Executes A$2B New Bank Facility

16:24 AEST July 19, 2010 ABN Newswire (C) 2004-2010 Asia Business News PL. All Rights Reserved.

Sydney, Australia (ABN Newswire) - Santos (ASX: STO) shares on Monday defied the market sell-off after the company said it had executed a A$2 billion bilateral bank loan facility. The new facility will be used to refinance its existing A$700 million of undrawn bilateral bank facilities that mature between 2011 and 2013 and to increase liquidity.

The facility was self-arranged and attracted total offers of A$2.9 billion from 13 banks. Offers from nine banks were accepted in arriving at the final facility size of A$2 billion with terms ranging from four to seven years. The weighted average term of the new facility is five years, the company said.

The facility will provide significant additional liquidity during the scheduled construction period of Gladstone LNG (GLNG) project and Papua New Guinea LNG (PNG LNG) project, and delivers average maturities beyond first LNG production from the two projects, said Santos Executive Vice President and Chief Financial Officer Peter Wasow.

Earlier this month Santos said it remains in detailed ongoing talks with a number of parties on potential LNG sales, equity in the project and collaboration between projects. It was reportedly that the company was close to completing LNG supply agreements with Korea Gas Corp. (KOGAS) (SEO: 036460) and Sinopec (SHA: 600028) (HKG: 0386).


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