Houston-based Chord Energy Corp (NASDAQ:CHRD) has successfully affirmed its $3 billion borrowing base and maintained its $1.5 billion aggregate elected revolving commitment amounts, the company announced in a recent SEC filing. The confirmation came as part of the semi-annual borrowing base redetermination completed on Monday (NASDAQ:MNDY).
In addition to reaffirming its borrowing base, Chord Energy has entered into a Sixth Amendment to its existing Credit Facility, which extends the company's ability to incur certain types of debt, such as Permitted Pari Passu Term Loan Debt and Permitted Junior Lien Term Loan Debt, until December 1, 2025. This amendment provides the company with continued financial flexibility for an additional year.
The next redetermination of the borrowing base is anticipated to take place around April 2025, as per the company's regular financial calendar.
The details of the Sixth Amendment, which was dated November 4, 2024, have been summarized in the SEC filing. For a comprehensive understanding of the terms, the full text of the amendment has been made available as an exhibit to the filing.
Chord Energy, formerly known as Oasis Petroleum (NASDAQ:CHRD) Inc., is a Delaware-incorporated company operating in the crude petroleum and natural gas sector under the SIC code 1311. The company's headquarters are located at 1001 Fannin Street, Suite 1500, Houston, Texas.
The information disclosed is based on a press release statement and is intended to keep investors informed about the company's financial arrangements and ongoing commitments.
In other recent news, Chord Energy reported strong Q3 results, raising its full-year pro forma oil guidance and trimming its capital guidance, reflecting operational efficiencies.
Despite temporary production curtailments due to wildfires in North Dakota, the energy company achieved an adjusted free cash flow of about $312 million, returning 75% of it to shareholders through dividends and share repurchases. The company's three-year outlook projects stable oil volumes and $1.4 billion in annual capital expenditures.
Recent developments also include the integration of Enerplus (NYSE:ERF) assets, aiming for over $200 million in annual synergies, and the completion of over 100 three-mile lateral wells. However, production curtailments in North Dakota are expected to impact Q4 oil volumes by about 900 barrels per day, and natural gas and NGL realizations were below expectations due to weak AECO pricing.
Analysts note that the company's capital allocation strategy is adaptable to commodity price fluctuations, and improvements in gas prices could be seen with the online launch of LNG Canada in mid-2024. This is part of Chord Energy's commitment to sustainable growth and operational excellence, as it continues to navigate market conditions and return value to shareholders.
InvestingPro Insights
Chord Energy's recent affirmation of its $3 billion borrowing base and the extension of its debt incurrence ability align well with its current financial position. According to InvestingPro data, the company operates with a moderate level of debt, and its cash flows can sufficiently cover interest payments. This financial stability is further reflected in Chord Energy's impressive profitability metrics, with a P/E ratio of 6.76 and an operating income margin of 29.97% for the last twelve months as of Q3 2024.
InvestingPro Tips highlight that Chord Energy pays a significant dividend to shareholders, with a current dividend yield of 8.44%. This generous dividend policy, combined with the company's strong financial position, may be attractive to income-focused investors. Additionally, the stock generally trades with low price volatility, which could appeal to risk-averse investors looking for stability in the energy sector.
For those interested in a deeper analysis, InvestingPro offers 7 additional tips for Chord Energy, providing a more comprehensive view of the company's financial health and market position.
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