GE Energy unit closes on $200m senior debt oil deal

The senior secured revolving credit facility will help All American Oil & Gas refinance and pay for reserve development for an oil field in California.   

GE Energy Financial Services, the energy-focused group of GE Capital, has arranged a senior secured revolving credit facility for All American Oil & Gas to refinance debt and fund reserve development in the Bakersfield, California, Kern River Oil Field. The $200 million facility — with a $131 million initial borrowing base -– was provided to oil and gas exploration and production company Kern River Holdings, a wholly-owned subsidiary of All American Oil & Gas, GE announced today (15 October). 

GE Energy Financial Services served as administrative agent and, through its GE Capital Markets affiliate, acted as lead arranger and book runner. Further details about the transaction were not disclosed. 

The Kern River Oil Field was discovered in 1899 and covers 10,750 acres in the San Joaquin Valley of California. It is the second largest oil field in the state and fifth largest in the US, with cumulative production exceeding 2.2 billion barrels of oil to date and current production of 70,000 barrels of oil per day. Steam flooding and horizontal drilling have made it possible to extend the life of the field, increase production and proven reserves, and enhance recovery factors to over 65 percent. 

“Partnering with GE on this transaction ensured that Kern River Holdings would have the necessary capital to fund our development plans,” Bob Morris, the chairman of All American Oil & Gas, said in a statement. 

“We are impressed with the management team and historical performance at Kern River Holdings, and look forward to helping the company grow with efficient capital solutions,” Carl Peterson, a managing director and head of energy lending at GE Energy Financial Services, said in a statement. 

Since 1991, GE Energy Financial Services' Oil and Gas team has provided over $5 billion in partnership equity and debt to independent private and public oil and gas operators in the US and the UK North Sea. Based in Stamford, Connecticut – with an office in Houston, Texas – the Oil and Gas unit is active in all major onshore basins, in the Gulf of Mexico, and in the UK North Sea. GE Energy Financial Services holds approximately $16 billion in assets over all. 

Kern River Holdings owns and operates oil and gas leases in the Kern River field in the San Joaquin Valley in California. The company currently produces approximately 1500 barrels per day of heavy oil using steam flood technology across 155 acres of leases in the southwestern portion of the Kern River Field.