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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Think4Yourself who wrote (65480)	4/28/2000 9:44:00 PM
From: Think4Yourself	Read Replies (1) \| Respond to of 95453

At last there is good news from MEXP!! Miller Exploration Company Announces Extension of Credit Facility And Plans for Debt Refinancing TRAVERSE CITY, Mich., April 28 /PRNewswire/ -- Miller Exploration Company (Nasdaq: MEXP - news), (the ``Company'' or ``Miller'') today announces plans for debt refinancing. Debt Financing The Company has reduced its outstanding bank balance by 50% from $37 million in 1st quarter of 1999 to $18.4 million presently and is in the process of negotiating a revolving credit facility with a new lender which would replace its existing Senior Lender. The Company's Senior Lender, Bank of Montreal, has agreed to extend the borrowing base redetermination date from April 30, 2000 to June 15, 2000 to allow the Company additional time to negotiate a new credit facility with a new lender. The Company expects that the new facility would reduce its interest costs and provide capacity for future capital needs as reserves are developed. The Company plans to continue to de-lever the balance sheet and improve working capital through an aggressive principal repayment plan while continuing to deploy capital to further develop its expansive 3D prospect inventory in Mississippi. As disclosed in an earlier press release, the Company projects capital expenditures for 2000 to be an unrisked $7.4 million. As part of the extension agreement, the permanent maturity date of the existing credit facility has been extended from April 1, 2001 to June 15, 2001. The extension fee was also reduced from 2% of the outstanding bank balance to $150,000. The extension agreement requires monthly principal payments of $1 million commencing April 30, 2000 and continuing until the earlier of payment of the loan in full, June 15, 2001 or the next borrowing base redetermination date. The redetermination date can be requested by either the Company or the Senior Lender. The extension fee and principal and interest payments owed on or before May 1, 2000 were paid on April 28, 2000. ...

To: Think4Yourself who wrote (65480)	4/29/2000 12:07:00 AM
From: jim_p	Respond to of 95453

JQP, Good post. Regarding the issue of will oil companies be foolish enough to over leverage again? That is the was it has always been since day one and it will always be in the future. To be in the oil business in the first place you have to be an optimist or you wouldn't be in it. Second, 75% of all the wells are drilled in the United States are drilled by the independents, not the majors. The up and down cycles of the oil patch are a function of capital. When there is too much capital, oil companies tend to pay to much for acquisitions and drill poor prospects. When there is not enough we have a bust cycle. There is either too much or not enough capital, but rarely is there a middle ground for very long. Bankers are too competitive and they tend to have short memories. There has been no capital in this business since the price of oil collapsed. When capital comes back, and it always does, companies will raise (borrow) it and cap-x will increase. I had lunch today with an oil and gas banker in Houston. The bank closed their first new oil loan in over a year just last week. They are using $24 oil and $2.40 NG in their pricing, but the capital is just now starting to come back. Last week I met with a good fried who is a corporate attorney in Houston, and the law firm just filled a registration for a common stock offering for a small cap oil and gas company. The bottom line is capital is starting to come back, and the level of activity will be a function of cash flow and capital. End of story. Jim