EnerJex Resources Announces a 75% Borrowing Base Increase to $12 Million
SAN ANTONIO, Nov. 1, 2012 /PRNewswire/ -- EnerJex Resources, Inc. (ENRJ) ("EnerJex" or the "Company"), a domestic onshore oil company, announced today that Texas Capital Bank, N.A. has approved a borrowing base increase from $7.00 million to $12.15 million under the Company's $50 million senior secured revolving line of credit. This improvement resulted from a significant increase in the estimated quantity and value of EnerJex's producing oil reserves. At present, the Company has $6.20 million drawn under this credit facility, which currently bears interest at a rate of 3.75% per annum.
EnerJex plans to utilize the additional availability under its credit facility to accelerate the development of its Mississippian and Cherokee shallow oil development projects in Kansas. The Company is actively drilling new wells in both areas where it has achieved nearly a 100% success rate since the beginning of 2011. Additional borrowing base increases are expected in the coming months following the addition of new oil production and the maturation of existing oil wells that recently began producing.
EnerJex's CEO, Robert Watson, Jr., commented, "I am pleased to announce a significant increase in the Company's borrowing base at attractive terms. Texas Capital Bank has been a great partner, and I expect this relationship to flourish as EnerJex continues to demonstrate repeatable and profitable growth. Despite the Company's tremendous progress over the past two years, the vast majority of its asset portfolio remains to be developed. Coupled with anticipated cash flow from operations, I expect this credit facility to fund EnerJex's aggressive growth plans at attractive terms for the foreseeable future."
About EnerJex Resources, Inc.
EnerJex is a domestic onshore oil company with assets located in Eastern Kansas and South Texas. The Company's primary business is to acquire, develop, explore and produce oil properties onshore in the United States. Additional information is available on the Company's web site at www.enerjex.com.
This press release and the materials referenced herein include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements give EnerJex's current expectations or forecasts of future events. The statements in this press release regarding the acquisition of operating assets and related agreements; any implied or perceived benefits from any current or future transaction, and any other effects resulting from any of the above, are forward-looking statements. Such statements involve risks and uncertainties, including but not limited to: whether acquired properties will produce at levels consistent with management's expectations; market conditions; the ability of EnerJex to obtain financing for continued drilling; the costs of operations; delays, and any other difficulties related to producing oil; the ability of EnerJex to integrate the newly purchased assets and any newly acquired employees; the price of oil; EnerJex's ability to market and sell produced minerals; the risks and effects of legal and administrative proceedings and governmental regulation; future financial and operational results; competition; general economic conditions; and the ability to manage and continue growth. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated. Important factors that could cause actual results to differ materially from the forward-looking statements are set forth in our Form 10-K filed with the United States Securities and Exchange Commission and our Form 10-Q. EnerJex undertakes no obligation to revise or update such statements to reflect current events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. EnerJex's production forecasts are dependent upon many assumptions, including estimates of production decline rates from existing wells and the outcome of future drilling activity. Although EnerJex believes the expectations and forecasts reflected in these and other forward-looking statements are reasonable, it can give no assurance they will prove to have been correct. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties.
EnerJex Resources, Inc.
Robert Watson, Jr., CEO
Phone: (210) 451-5545
Portage Equity Market Advisors, LLC
Jack Zedlitz, Managing Advisor
Phone: (405) 230-1182