Invico Diversified Income Fund (“IDIF”) announced today that it had successfully closed two senior secured loans worth a combined total of up to $34.5 million.
The first loan, worth up to $10.5 million, was extended to a private junior oil company located in Calgary, AB. The financing is expected to accelerate the company’s capital program and mark the beginning of a new chapter by increasing production and cash flow to accelerate investment into a carbon capture-enhanced oil recovery scheme. The ability to capture CO2 directly from the source aims to significantly reduce total emissions from the production process.
The second loan, worth up to $24 million, was extended to Halo Exploration, a private junior exploration and production company, also based in Calgary, AB, and will help the company accelerate its drilling activity over the next twelve months. “We are excited to partner with Invico, as we view their approach, technical excellence, and scalability as a significant milestone on our path to maximizing our value,” the company said in an update to shareholders.
Both deals are expected to benefit IDIF unitholders by providing an opportunity for upside through participation in reserve value accretion and offering protection against rising interest rates while providing a minimum yield for distributions.
“In addition to the benefits for our unitholders, we are pleased to participate in deals like these which support industry-leading partners in their move towards producing clean and ethical Canadian energy,” said Jason Brooks, President of Invico and Portfolio Manager of IDIF. “Each company has above-average ESG attributes and several existing initiatives, including a carbon capture project and an agreement targeting emissions reductions through installing hydrocarbon vapour recovery systems and adding new natural gas-gathering infrastructure in remote areas to preclude flaring. With our bench strength in energy, including a dedicated technical team to evaluate opportunities, Invico is uniquely positioned to offer private debt solutions to the energy industry as traditional sources of debt and equity remain constrained.”
To learn more about investing with IDIF, visit our Investing page.