UPDATE 1-Quicksilver launches amendment to debt agreement

* Amendment to increase interest rate By 250 basis points

* Says continues to monitor debt capital markets * Shares up 8 percent

May 28 (Reuters) - Independent oil and gas company Quicksilver Resources Inc (KWK.N: Quote, Profile, Research) said it was seeking an amendment to its credit agreement of about $598 million of outstanding debt.

Shares of the company were trading up 8 percent at $10.81 Thursday afternoon on the New York Stock Exchange.

Quicksilver added if the amendment were to be approved by its lenders it would take another loan to pay down the debt, which is due 2013.

"The amendment would also relax certain asset coverage covenants through March 31, 2010, and increase the interest rate as of June 30, 2009, by 250 basis points," the company stated in a filing with the U.S. Securities and Exchange Commission.

In early May, Quicksilver had said it would focus on tighter cost control and debt reduction. The company had said total debt outstanding at the end of its first quarter was about 2.5 billion, excluding that of its subsidiary Quicksilver Gas Services (KGS.P: Quote, Profile, Research).

For the alerts, please double click [ID:nWNAB4328] (Reporting by Arup Roychoudhury in Bangalore; Editing by Anil D'Silva)

(arup.roychoudhury@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging: arup.roychoudhury.reuters.com@reuters.net))