PV9 Value definition

PV9 Value means, with respect to any Engineered Oil and Gas Properties or other Oil and Gas Properties becoming Engineered Oil and Gas Properties, the net present value, discounted at 9% per annum, of the future net revenues expected to accrue to the Borrower’s and the other Loan Parties’ collective interests in such reserves expected to be produced from such Oil and Gas Properties during the remaining expected economic lives of such reserves made in accordance with the then existing standards of the Society of Petroleum Engineers (with appropriate adjustments made for hedging operations) as follows:

Split View

AI-Powered Contracts

Draft, Review & Redline at the Speed of AI

Get StartedSchedule a Demo

PV9 Value means the net present value of the oil and gas to be produced from the Oil and Gas Properties of the Borrower included in the most recent determination of the Borrowing Base, calculated using a discount rate of nine percent (9.00%) per annum and reserve estimates, prices, production rates and costs acceptable to the Collateral Agent.

PV9 Value means, as of any Test Date the net present value, determined using a discount rate of nine percent (9%) per annum, of the future net revenues expected to accrue to the Borrower’s and the Subsidiary Guarantors’ collective interest in the Proved Reserves attributable to the Borrower’s and the Subsidiary Guarantors’ Oil and Gas Properties described in the then most recent Reserve Report delivered to the Administrative Agent pursuant to this Agreement, for the period commencing on the day after such Test Date through the remaining expected economic lives of such Oil and Gas Properties; provided, however that for purposes of the calculation of Adjusted PV9%, not more than 30% of the Adjusted PV9% shall be attributable to Oil and Gas Properties described in such Reserve Report as Proved Undeveloped Reserves. Each calculation of such expected future net revenues shall be made in accordance with the then existing standards of the Society of Petroleum Engineers, provided that in any event (a) appropriate deductions shall be made for severance and ad valorem taxes and for operating, gathering, transportation and marketing costs, required for the production and sale of Hydrocarbons from such Oil and Gas Properties, (b) the pricing assumptions used in determining PV9% Value for any Oil and Gas Properties shall be based upon the Strip Price, adjusted in a manner reasonably acceptable to the Administrative Agent to reflect the Borrower’s Hedging Agreements with Secured Parties in respect of forecasted production from Proved Reserves from such date after such Test Date and (c) the cash-flows derived from the pricing assumptions set forth in clause (b) above shall be further adjusted to account for the historical basis differential in a manner reasonably acceptable to the Administrative Agent. The amount of PV9% Value at any time shall be calculated on a pro forma basis for dispositions and acquisitions of Oil and Gas Properties consummated since the date of the Reserve Report most recently delivered pursuant to this Agreement (provided that, in the case of any such acquisition or disposition, as the case may be, the Administrative Agent shall have received a Reserve Report evaluating the Proved Reserves attributable to the Oil and Gas Properties subject thereto and if such acquisition is a Material Acquisition, such Reserve Report shall be prepared by an Approved Petroleum Engineer).

Examples of PV9 Value in a sentence

• The Borrower shall not permit the total aggregate Debt of the Borrower and its Subsidiaries to exceed the lesser of (a) 100% of the PV-9 Value of the Producing Reserves and (b) 70% of the PV-9 Value of the Proved Reserves, at any time.

• In addition, as to any such Oil and Gas Properties, the Borrower must provide title information satisfactory to the Administrative Agent in its sole discretion with regard to Oil and Gas Properties constituting at least eighty percent (80%) of the PV9 Value set forth in the most recently delivered Reserve Report.

• Administrative Agent shall have received all documents and instruments requested pursuant to Section 5.10, which title information (i) shall collectively cover at least eighty percent (80%) of the PV9 Value and (ii) shall be in form and substance satisfactory to Administrative Agent in its sole discretion.

• Administrative Agent shall be satisfied in its sole discretion with the title to the Oil and Gas Properties of the Loan Parties and that such Oil and Gas Properties constitute at least eighty percent (80%) of the PV9 Value.

• The Borrower shall not permit the total aggregate Debt of the Borrower and its Subsidiaries (other than the outstanding principal amount of Debt under the RBS Loan Agreement) to exceed the lesser of (a) 100% of the PV-9 Value of the Producing Reserves and (b) 70% of the PV-9 Value of the Proved Reserves, at any time from and after June 30, 2007.

• In this connection, the Lender will not unreasonably withhold its consent to sales during any 12-month period of Property of the Borrowers, in the aggregate, having PV9 Value of up to 10% of all Property of the Borrowers utilized in determining the Borrowing Base.

• All title or other information received after the Closing Date by any Loan Party which discloses any material defect in the title to any property included in the Borrowing Base with a PV-9 Value in excess of $5,000,000.

• The title of any Loan Party to any of the Oil and Gas Properties subject to the Mortgages in excess of ten percent (10%) of the PV9 Value of such Oil and Gas Properties according to the most recent Reserve Report shall become the subject matter of a claim of title adverse to such Loan Party in litigation before any Governmental Authority or arbitrator and reasonably adequate reserves have not been established for such claim.

• Borrowers covenant that the aggregate PV9 Value of all proved developed producing and proved developed non-producing oil and gas properties of Borrowers that are evaluated in the most recent engineering report delivered to Bank and are subject to a lien in favor of Bank shall at all times be not less than 150% of the Borrowing Base in effect from time to time.

More Definitions of PV9 Value

PV9 Value means, as of any date of determination, with respect to any Proved Reserves expected to be produced from any of the Loan Parties’ Oil and Gas Properties, the net present value of the future net revenues (discounted at nine percent (9%) per annum) calculated by Administrative Agent in its sole reasonable judgment (including using price curve and costs determined in accordance with the definition of Reserve Report and giving effect to any Hydrocarbon Hedging Agreements) after having reviewed the information from the most recently delivered Reserve Report (or, in the case of any determination of PV9 Value as of the last day of the first and third fiscal quarter of any year, as set forth in a roll forward to such date from the most recently delivered Reserve Report that is reasonably acceptable to Administrative Agent), calculated using 5-year New York Mercantile Exchange strip pricing on such date of determination, as adjusted (a) for applicable local basis differentials or premiums and gathering and transportation costs (in each case as determined by Administrative Agent in its sole reasonable judgment) and held flat after such 5-year period and (b) by taking into account aggregate production, Dispositions and reductions by any such revenue from any Oil and Gas Properties which Administrative Agent determines are not in compliance with the terms and covenants of this Agreement (including without limitation Section 5.10 hereof) or any Loan Document; provided that if Borrower fails to deliver any Reserve Report required to be delivered hereunder, the PV9 Value shall be the value calculated by Administrative Agent in its sole and absolute discretion.

PV9 Value means, with respect to any Proved Reserves expected to be produced from a Loan Parties’ Oil and Gas Properties, the net present value of the future net revenues (discounted at nine percent (9%) per annum) calculated by Administrative Agent in its sole reasonable judgment (including using price curve and costs determined in accordance with the definition of Reserve Report) after having reviewed the information from the most recently delivered Reserve Report and taking into account aggregate production, Dispositions and reductions by any such revenue from any Oil and Gas Properties which Administrative Agent determines are not in compliance with the terms and covenants of this Agreement (including without limitation Section 5.10 hereof) or any Loan Document; provided that if Borrower fails to deliver any Reserve Report required to be delivered hereunder, the PV9 Value shall be the value calculated by Administrative Agent in its sole and absolute discretion.