(Source: PRNewswire)
HOUSTON, Aug. 10 /PRNewswire-FirstCall/ -- Mainland Resources, Inc., (OTC Bulletin Board: MNLU) (5MN-Frankfurt) has closed on a $3.5 million bridge loan financing with Guggenheim Corporate Funding, LLC. $1.7 million of the funds have been advanced to Mainland with the remaining $1.8 million to be advanced after certain conditions are met. The term financing also proposes non- binding conditions for a $10 million senior secured advancing line of credit to be further negotiated by the parties. SMH Capital Inc. acted as exclusive financial advisor to Mainland Resources in relation to the Guggenheim financing.
Mainland Resources secured the bridge loan based on its successful participation as a working interest partner with Petrohawk Energy Corporation in the drilling and completion of the Griffith No. 1 Well in the Company's East Holly project located in DeSoto Parish, Louisiana. The Griffith No. 1 well reported initial production in excess of 23 million cubic feet of gas per day and is currently on production, generating revenue for Mainland.
The proceeds from the $3.5 million bridge loan will be primarily used to fund near-term drilling and completion capital requirements associated with two additional Haynesville Shale wells in Mainland's East Holly project area and to acquire oil and gas leases related to the Company's recently announced Mississippi prospect. Should the parties decide to pursue the $10 million line of credit facility, Guggenheim will have the opportunity to participate in the Mississippi project with up to a 10% working interest.
Company President Mike Newport states, "This funding is a significant step forward for Mainland Resources. We are pleased to have the opportunity to partner with Guggenheim Corporate Funding and look forward to working with Guggenheim to execute on our strategy of creating shareholder value through a disciplined acquisition and development program going forward. They are one of the most respected firms providing capital to oil and gas companies today, and we appreciate their confidence in our future."
About Mainland Resources, Inc.
Mainland Resources is a junior company engaged in the exploration and development of oil and gas resources. The Company's current initiatives are focused on the acquisition and development of leases in emerging gas regions with the potential for discoveries including the Haynesville Shale.
About Guggenheim Partners, LLC
Guggenheim Partners, LLC is a privately held, diversified financial services firm that, through its affiliated entities, provides financial advisory services, corporate finance, wealth management and investment management products to high-net-worth individuals and institutional investors.
