September 13, 2012 / 4:41 PM / 5 years ago

RLPC: Plains Exploration sets talk on $1.25B loan

NEW YORK, Sept 13 (Reuters) - Plains Exploration & Production Co is circulating price talk on the $1.25 billion term loan to back its purchase of assets from BP and Shell ahead of an official launch of the facility this afternoon, sources told Thomson Reuters LPC.

The seven-year term loan is talked at 325-350bp over Libor. The loan will have a 1 percent Libor floor and will be sold at a discount of 99 cents on the dollar, sources said.

JP Morgan is launching the loan to investors today at 1 p.m.

The facility is part of $7 billion in committed facilities the oil and gas company received to back its $6.1 billion acquisition of assets in the Gulf of Mexico.

Bank of America Merrill Lynch, BMO, Barclays, Citigroup, RBC, The Bank of Nova Scotia, TD Securities, and Wells Fargo join JP Morgan in providing initial acquisition financing. The rest of the financing is rounded out by a $2 billion bridge loan, a $3 billion, five-year revolving credit facility and a $750 million, five-year term loan.

On September 10, Plains Exploration announced the acquisition of 100 percent of BP's interest in certain deepwater oil and gas properties for $5.55 billion. At the end of July, these properties were producing an estimated 59,500 barrels of oil equivalent net per day.

The transaction is expected to close by year-end 2012. Also on September 10, PXP announced the acquisition of Shell Offshore Inc.'s 50 percent working interest in the Holstein Field, for $560 million.

At the end of July 2012, these properties were producing an estimated 7,400 barrels of oil equivalent net per day. This transaction is also expected to close by year-end 2012.

Houston-TX based Plains Exploration & Production Company produces oil and gas in California, Texas, Louisiana, and the Gulf of Mexico.

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