An operator in the Permian Basin has kick-started its full-scale horizontal development program thanks to a new multimillion-dollar loan provided by Production Lending LLC.

In a recent release, Production Lending said it had supplied a $10 million loan to MEI Camp Springs LLC, which is owned by Moriah Energy Investments. The loan was closed and funded on Aug. 30.

Commenting on the financing, MEI Camp Springs CFO Tyler Harris said the transaction with Production Lending “meaningfully enhances our ability to execute on our multiyear development plan in the Camp Springs area.”

Proceeds from the loan will be used to drill and complete two horizontal wells located in the Camp Springs area in the Eastern Shelf of the Permian Basin, where the Midland, Texas-based company is focused.

The roughly 40,000-acre Camp Springs field has seen a surge of activity in recent years, according to the company release, as operators have flocked the potential of the Middle Odom Sands with the advent of modern hydraulic fracturing technology. The field currently has more than 31 producing horizontal wells with more than 18 active permits on record.

MEI Camp Springs has over 5,000 acres of leasehold in Scurry and Fisher counties, Texas, within the prolific Middle Odom sand play.

According to the release, Production Lending’s financing package will allow MEI Camp Springs to kick-start its full-scale development program. The company has already drilled and completed one successful well on its acreage.

Two former energy bankers, Abhishek Kumar and Ryan Childs, own and run Production Lending, which caters to small, private oil and gas companies with U.S. onshore operations.

In an interview during this year’s Summer NAPE, Childs told HartEnergy.com it is important for smaller E&Ps to know that there are options.

“Given the climate of where we are today, we obviously understand that a lot of capital has been pulled away from the larger players in the industry, but that’s also affected the smaller companies too,” he said. “I think it’s important for a lot of these companies to be aware that there are still capital providers out there that are willing to support U.S. onshore conventional deals.”

Since its launch in 2016, Production Lending has funded 18 different debt transactions for a total capital commitment of more than $45 million. The Houston-based firm focuses on deals less than $25 million in size.

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