CNX to complete $500mn senior note issue

CNX Resources has announced the closing date for its $500mn senior note issue of 7.375% notes at 100% of their face value.

The US Appalachia producer said September 12 it aimed to close the financing round on September 26, subject to customary closing conditions. Revenue from bond sales will help CNX pay down $350mn of the aggregate principle from its outstanding 2027 senior bonds, offered at 7.2% interest.

CNX Resources operates low-carbon gas assets in the Applachia's upstream and midstream. Shale gas sales during the second quarter totalled 122.1bn ft³ and 135.8bn ft³ in the previous three months, up from 115.3bn ft³ last April to June.

But the company is among the most heavily hedged US producers, and is expected to book significant write-downs on the market rate in 2022, as its positions were locked down before the recent energy crunch.

CNX Resources is hedging 112.8bn ft³ from net production in the third quarter, at an average price of $2.89/'000 ft³, while for the full year '22 453.0bn ft³ will be held at $2.92. Before hedging, the realised price forecast for 2022-end was $6.01/'ooo ft^3.

CNX's hedged position of almost 95% of net production materially exceeds the typical 45-75% range for US gas producers, set out by Rystad Energy research late last year.