As we reported in March, EV Energy Partners (EVEP)–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. Earlier this month EVEP announced they have had to decrease their borrowing base from $625 million to $450 million (see EV Energy Partners Lowers Borrowing Base by 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. The company continues in survival mode: They’ve just announced they are suspending cash payments to unit holders (think dividend payments to stockholders)…
