Southern Energy Corp on Monday said it successfully executed a fifth amendment to its existing senior secured term loan, including raising the tranche B commitment to $31.5 million.

Southern Energy is a natural gas exploration and production company, focused on acquiring and developing conventional natural gas and light oil resources in Mississippi, Louisiana, and East Texas.

The fifth amendment includes the extension of the tranche B availability to August 31, 2025 and a $2.0 million increase to a total tranche B commitment of $31.5 million.

Southern Energy said it will have around $11.5 million remaining on the facility upon execution of the fifth amendment, with a current outstanding balance of approximately $17.6 million.

The amendment also extends the principal amortisation period by a further year, while maintaining the existing 12% annual coupon.

This will reset the debt service coverage ratio covenant calculation to an annualised basis, Southern Energy said, beginning in the fourth quarter of 2023 and allowing for repayment and reborrowing under the tranche B facility.

In connection with the fifth amendment, Southern Energy has also agreed to extend the term of 3.9 million share purchase warrants previously issued to the unnamed lender from April 30, 2024 until August 31, 2025. Southern Energy said this remains subject to the final approval of the TSX Venture Exchange in Toronto.

‘The amendments to the credit facility from our existing credit provider provides additional flexibility and credit capacity to support our strategy to grow both inorganically and organically with long-term development operations in the Gwinville field to maximize leveraged returns for shareholders,’ said Chief Financial Officer Calvin Yau.

Shares in Southern Energy were untraded at 20.00 pence each in London on Monday afternoon.

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