Tidewater announces increase to its existing credit facility and additional arrangement at Pipestone Montney plant

Credit Facility Increase

Tidewater Midstream and Infrastructure Ltd. (“Tidewater” or the “Corporation”) (TSX: TWM) is pleased to announce that it has amended its existing Credit Facility (the “Amended Credit Facility”) with its banking syndicate of six Canadian Financial Institutions (the “Syndicate”). The amendments provide additional stability to the Corporation’s financial position.

Pursuant to the Amended Credit Facility, total availability under the Corporation’s credit facility has increased from $250 million to $325 million. The Amended Credit Facility also contains an accordion feature which permits the Corporation to increase the size of its credit facility to an aggregate of $350 million from $325 million.

The Amended Credit Facility also contains adjustments to the Corporation’s existing pricing grid, reducing overall borrowing costs as compared to the same leverage multiples in the previous credit agreement. Under the existing financial covenants and the amended interest rate pricing grid, the Corporation may also include up to 10% of projected annual EBITDA attributable to material projects currently under construction in its calculation of total EBITDA based on certain criteria. This will allow the Corporation more flexibility as its two major projects, Pipestone Montney Sour Gas Plant and TransAlta natural gas pipeline, are being completed.  This is expected to reduce interest rates being charged based on the amended pricing grid.

The Amended Credit Facility also extended the maturity date from March 24, 2020 to August 23, 2021, which may be further extended for a period of up to one year with the consent of the Syndicate.

“We are grateful for the continued support of our lenders and the vote of confidence this represents for Tidewater and our team” said Joel Vorra, Tidewater’s Chief Financial Officer. “The continued success of our midstream operations and the financial discipline we have exercised have put us in a strong financial position during the completion of our two major projects. Utilizing this financial flexibility, Tidewater will continue to pursue strategic projects, acquisitions and other opportunities.”

Additional Arrangement at Pipestone Montney Plant

At the Pipestone Montney Sour Gas Plant, Tidewater entered a non-binding Memorandum of Understanding with a large oil and gas producer for firm volumes of 25 MMcf/d over a five-year term. With this additional arrangement, Tidewater is fully contracted at the Pipestone Montney Sour Gas Plant, increasing forecasted contracted EBITDA for the project by approximately 10-20%. The parties are working to conclude a definitive agreement with respect to this arrangement early in the fourth quarter of 2018.

The Pipestone Montney Sour Gas Plant remains subject to regulatory approval.

The Corporation’s Business

Tidewater is traded on the TSX under the symbol “TWM”. Tidewater’s business objective is to build a diversified midstream and infrastructure company in the North American natural gas and natural gas liquids (“NGL”) space. Its strategy is to profitably grow and create shareholder value through the acquisition and development of oil and gas infrastructure. Tidewater plans to achieve its business objective by providing customers with a full service, vertically integrated value chain through the acquisition and development of oil and gas infrastructure including: gas plants, pipelines, railcars, trucks, export terminals and storage facilities.