Solutions for the oil and gas industry
Alternative debt financing for upstream oil and gas
Munich Re Reserve Risk Financing, Inc.
We are a Houston, Texas based, wholly-owned subsidiary of Munich Re, a AA- rated global insurance company operating across all risk lines.
Munich Re Reserve Risk Financing, Inc. ("MRRF") provides a unitranche alternative to combinations of bank RBL and junior/mezzanine debt that is:
- fixed-rate; with
- no borrowing base redeterminations.
We target established middle market upstream operators seeking to:
- accelerate production growth through conversion of PNP/PUD reserves;
- increase reserves/production through strategic asset acquisitions; and/or
- rationalize capital structures.
To comply with and support the Paris climate agreement, Munich Re is targeting net-zero carbon emissions from risks with the upstream oil & gas industry by 2050.
Within the pathway to reach this goal, Munich Re will continue to support clients in the upstream oil & gas sector with solutions that enable our clients to achieve their own ESG goals, e.g., by realizing carbon capture and sequestration projects that contribute to mitigating climate change.
- Non-dilutive, fixed-rate, senior secured, fully amortizing term loans
- Loan sizes from $75 to $250 million
- Loan tenors up to 7 years
- OID of 1.0% to 2.0%
- Fixed-price, fully-amortizing structure eliminates refinancing risk
- Total cost embedded in up-front fees plus fixed coupon – no equity “kickers”
- Recourse limited to subject properties and specific contractual undertakings of sponsor
- Munich Re credit enhancement supports term hedging of commodity prices at advantaged rates
- Subject properties located in North America
- Subject properties can include up to 50% PNP/PUD reserves provided that:
- Acceptable plan of development agreed as precondition to funding
- Capital sufficient to fund the plan is available and earmarked
- Development costs capped via turnkey with sponsor or acceptable third parties
- Subject properties to be “ring-fenced” via sponsor-owned SPV as borrower or VPP/Prepay/other acceptable form of conveyance relating specifically to the subject properties
- Experienced management with track record of creating value in target asset area/basin
- Hedging of associated commodity price risk
Do you have questions?
Phone: +1 (281) 203 5944
Phone: +1 (832) 592 0085
1790 Hughes Landing Blvd # 275,
Texas 77380, USA