|RANGE RESOURCES CORP filed this Form 10-Q on 07/30/2018|
generated cash flow and proceeds from asset sales, debt or equity securities may be issued to fund these requirements. Long-term cash flows are subject to a number of variables including the level of production and prices as well as various economic conditions that have historically affected the oil and natural gas business. A material decline in natural gas, NGLs and oil prices or a reduction in production and reserves would reduce our ability to fund capital expenditures, meet financial obligations and operate profitably. We establish a capital budget at the beginning of each calendar year and review it during the course of the year, taking into account various factors including the commodity price environment. Our 2018 capital budget is currently $941.2 million.
We operate in an environment with numerous financial and operating risks, including, but not limited to, the inherent risks relating to the search for, development and production of natural gas, NGLs and oil, the ability to buy properties and sell production at prices which provide an attractive return and the highly competitive nature of the industry. Our ability to expand our reserve base is, in part, dependent on obtaining sufficient capital through internal cash flow, bank borrowings, asset sales or the issuance of debt or equity securities. There can be no assurance that internal cash flow and other capital sources will provide sufficient funds to maintain capital expenditures that we believe are necessary to offset inherent declines in production and proven reserves. Commodity prices continue to be depressed and, as such, we have adjusted and must continue to adjust our business through efficiencies and cost reductions to compete in the current price environment which also requires reductions in overall debt levels over time. We plan to continue to work towards profitable growth within cash flows. We would expect to monitor the market and look for opportunities to refinance or reduce debt based on market conditions.
As of June 30, 2018, we maintained a revolving credit facility with a borrowing base of $3.0 billion and aggregate lender commitments of $2.0 billion, which we refer to as our bank credit facility. The bank credit facility, during a non-investment grade period, is secured by substantially all of our assets and has a maturity date of April 13, 2023. See Note 9 for additional information. Availability under the bank credit facility is subject to a borrowing base set by the lenders annually with an option to set more often in certain circumstances. Availability under the bank credit facility, during an investment grade period, is limited to aggregate lender commitments. As of June 30, 2018, the outstanding balance under our credit facility was $1.3 billion. Additionally, we had $281.4 million of undrawn letters of credit leaving $404.6 million of committed borrowing capacity available under the facility at the end of second quarter 2018, with an additional $1.0 billion in borrowing base capacity for potential increases in lender commitments.
Our bank credit facility imposes limitations on the payment of dividends and other restricted payments (as defined under our bank credit facility). The bank credit facility also contains customary covenants relating to debt incurrence, liens, investments and financial ratios. We were in compliance with all covenants at June 30, 2018. See Note 9 to our unaudited consolidated financial statements for additional information regarding our bank debt.
Cash Dividend Payments
On June 1, 2018, our Board of Directors declared a dividend of two cents per share ($5.0 million) on our outstanding common stock, which was paid on June 29, 2018 to stockholders of record at the close of business on June 15, 2018. The amount of future dividends is subject to discretionary declaration by the Board of Directors and primarily depends on earnings, capital expenditures, debt covenants and various other factors.
Cash Contractual Obligations
Our contractual obligations include long-term debt, operating leases, derivative obligations, asset retirement obligations and transportation, processing and gathering commitments. As of June 30, 2018, we do not have any capital leases. As of June 30, 2018, we do not have any significant off-balance sheet debt or other such unrecorded obligations and we have not guaranteed any debt of any unrelated party. As of June 30, 2018, we had a total of $281.4 million of undrawn letters of credit under our bank credit facility.
Since December 31, 2017, there have been no material changes to our contractual obligations other than a $103.0 million increase in our outstanding bank credit facility balance and pricing changes for current contracts. Our contractual obligations for firm transportation and gathering contracts increased by approximately $171.0 million over the next twenty years related to these changes.