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Athabasca Oil Corp. set a new record for a sale of Canadian-dollar-denominated high-yield bonds, raising $550-million Friday in an offering that provides further evidence of the maturation of the market for junk-rated debt.

The oil company, which owns huge swathes of properties that need to be developed, had sought to sell as much of $600-million of debt, with hopes of an interest rate as low as 7 per cent.

In the end, the bonds were priced to yield 7.5 per cent, giving investors a little extra cushion to account for the risk that Athabasca doesn't produce enough cash flow yet to cover interest payments, and will have to use other means such as asset sales to generate cash.

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The sale, led by GMP Securities and TD Securities, comes soon after Sherritt International Corp. raised $500-million, and is yet another signal that investors are willing to buy large deals that are priced in Canadian dollars.

The money will enable Athabasca to put a heap of cash on its balance sheet, giving the company the ability to negotiate better terms as it seeks joint ventures.

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