EV Energy Partners Lowers Borrowing Base by 28%

As we reported in March, EV Energy Partners–an upstream master limited partnership (MLP) created by EnerVest that holds enormous acreage in the Ohio Utica Shale play–is in survival mode (see EV Energy Partners: No New Utica Wells in 2016, in Survival Mode). EVEP has no plans to drill new Utica wells in 2016. The company is on an austerity budget–only spending to complete 10 already-drilled wells in the Texas Barnett Shale. Yesterday EVEP announced they have had to decrease their borrowing base from $625 million to $450 million–down 28%. A company’s borrowing base is the value of its assets–in this case the value of the leases and oil/gas wells EVEP owns. Those assets are used as collateral to back up loans and IOUs. A lower borrowing base means a) they can borrow less money, and b) they will pay more in interest for the money they do borrow. Here’s yesterday’s EVEP announcement…

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