The Puerto Rico Electric Power Authority is given an extension of until November 3 to reach an agreement on how it would pay its $8.3 billion debt from its bondholders.

Bloomberg reported the investors that hold 35 percent of PREPA's debt granted the power utility agency until Friday to reach a forbearance agreement, keeping the debt restructuring negotiations out of court. This delay is the 12th extension since August 2014, which was when the two parties first signed the debt agreement.

According to PR NewsWire PREPA Governing Board Harry Rodriguez, "As we continue our efforts to transform PREPA, this extension affords us additional time to continue constructive negotiations with our key creditors."

"Working with our creditors to restructure PREPA's debt is an important component of our comprehensive plan that shares the burden of addressing PREPA's finances among all stakeholders.  We look forward to continuing to make progress towards this transformation which will create a better future for PREPA and provide Puerto Ricans the economical, safe and reliable utility they are asking for," said Rodriguez.

According to Reuters, the bondholders and the lenders who signed the extension already agreed to a restructuring deal with the power utility agency. However, in order for the deal to work, the agency would still require support from bond insurers such as Assured Guaranty and MBIA's National Public Finance Guarantee. According to PREPA it will use the extra four days to make deals with insurers, who are not involved in the forbearance agreement. This means, it could lead to these insurers suing PREPA if the deal goes sour. This could also push the power utility agency to go for a financial receiver.

PREPA is under negotiations with insurance companies to guarantee a $2.5 billion repayment should the agency defaults on its debt. These insurers plan to include an instrument that would give liquidity before agreeing to the deal.