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Oasis Petroleum Successfully Completes Financial Restructuring

Source: www.gulfoilandgas.com 11/19/2020, Location: North America

Oasis Petroleum Inc. has successfully completed its financial restructuring and emerged from Chapter 11. Oasis Petroleum has successfully restructured its balance sheet and reduced its prepetition debt by $1.8 billion and resolved the Mirada litigation, pursuant to its restructuring support agreement and "pre-packaged" restructuring plan (the "Plan") confirmed by the Bankruptcy Court on November 10, 2020. Oasis Petroleum's new common stock is expected to commence trading on NASDAQ under the ticker symbol OAS at market open on November 20, 2020.

Chairman of the Board, Douglas E. Brooks said, "On behalf of the new board of directors, I would like to acknowledge our appreciation to our employees for their diligent work during this process. Oasis is now uniquely positioned with a best-in-class balance sheet, a quality and sustainable long-lived asset base, and a rigorous new capital discipline that should translate into long-term value creation for our shareholders. This new direction for Oasis will be executed within a strong ESG culture to provide value for all stakeholders. The offices of the CEO and Non-Executive Chairman have been separated to reflect the broader strategic issues including, but not limited to, balancing cash returns and growth initiatives while maintaining operational excellence and sound environmental stewardship."

Restructuring Highlights
Oasis' new capital structure includes a new $575 million reserve-based revolving credit facility ("New RBL Facility") maturing in May 2024. Oasis' unsecured claims, including holders of Oasis' senior unsecured notes, received their proportionate distribution of 100% of Oasis' newly issued common stock (subject to dilution).

New RBL Facility
- $575 million borrowing base
- $340 million drawn at emergence
- First borrowing base redetermination scheduled for April 1, 2021
- Matures May 2024
- LIBOR + 300-400 bps rate with 100 bps floor

New Common Equity and Warrants
- Equity allocated to unsecured note holders: Approximately 20 million shares of common stock outstanding
- Shares authorized at emergence: 60 million shares
- Shares reserved for Long Term Incentive Plan, which constitutes the Management Incentive Plan: approximately 2.4 million shares
- Warrants to current Oasis Petroleum shareholders: Approximately 1.6 million warrants exercisable for one share of common stock at an initial exercise price of $94.57, expiring on November 19, 2024.

New Board of Directors
Oasis Petroleum has appointed a new Board of Directors effective today composed of experienced industry professionals with a clear understanding of the expectations and objectives of shareholders. Douglas E. Brooks has been named Chairman of the Board. The new Board of Directors consists of seven members (six of whom are independent) including: Douglas E. Brooks (Chairman), Thomas B. Nusz (CEO), Samantha Holroyd, John Jacobi, N. John Lancaster, Jr., Robert McNally and Cynthia L. Walker.

Pro Forma Capital Structure Details
In accordance with the Plan, approximately $1.8 billion in pre-petition senior unsecured notes have been equitized resulting in $112.5 million in annual interest savings.

Chief Executive Officer and Director, Thomas B. Nusz said, "Today marks a new beginning for Oasis Petroleum. We are emerging from the bankruptcy process as an even stronger company with an intense focus on generating sustainable returns and positive free cash flow coupled with a sharp goal of creating long term value for our shareholders. These outcomes will be achieved by further cost reductions, new efficiencies, and strategic repositioning to reflect the current industry conditions.

I'd like to express our gratitude to our stakeholders including our regulators, vendors, customers, royalty interest owners, working interest owners and surface owners for their partnership throughout this process. The support of our lenders and noteholders has also been critical to the efficient completion of our financial restructuring. Finally, I want to thank our employees for their ongoing dedication to safety and execution. We look forward to operating efficiently, safely and responsibly, for the benefit of our stakeholders and communities, as we maximize our value for shareholders."

Hedging
Oasis Petroleum currently has 29 mbopd swapped at $42.09 per barrel in 2021, 19 mbopd swapped at $42.74 per barrel in 2022, and 14 mbopd swapped at $43.68 per barrel in 2023.

Listing on the NASDAQ
In connection with emergence from Chapter 11, all of the Company's existing equity interests will be cancelled, effective before the market opens on November 20, 2020. Shares of the Company's new common stock will commence trading on the NASDAQ under the ticker symbol "OAS" on November 20, 2020.

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