Chaparral Vitality has filed for Chapter eleven defense in U.S. Bankruptcy Court docket in Delaware, 3 months just after warning that a fall in commodity price ranges threatened its capability to keep on being in business enterprise.
“While we have taken very carefully calculated and decisive motion to address the problems of 2020, the in general impact to the energy business, including Chaparral, has been serious,” chief government officer Chuck Duginski said in a assertion. “A swift restructuring will suitable-dimension our balance sheet, strengthen our value composition, and ideal position Chaparral for the long run.”
It is the second bankruptcy submitting for Chaparral in 4 yrs.
Chaparral reported it expects to considerably delever and restructure its balance sheet by equitizing all $three hundred million of its present unsecured bond obligations. It reported it will bolster its liquidity position by way of $a hundred seventy five million in lending obligations under a reserves-primarily based exit facility. Chaparral reported holders of about 78% of its to start with-lien credit rating facility and about 78% of holders of its eight.75% senior notes due 2023 have agreed to vote in favor of a prepackaged program.
The Oklahoma Metropolis-primarily based, which operates in the Andarko Basin, experienced dollars on hand of about $32 million on August 14, which will allow for it to keep functions by way of the restructuring. It previously terminated all exceptional spinoff contracts in connection with the forbearance by its loan companies.
Chesapeake Vitality, California Resources, and Whiting Petroleum are between the energy organizations that have filed for bankruptcy protections in new months.
In April, Brent crude traded below $19 for every barrel for the to start with time since 2002 as the COVID-19 disaster decreased desire and a cost war among Saudi Arabia and Russia led to a provide glut.
Chaparral’s shares have been buying and selling at 39 cents on Monday. The company’s investment bankers have reported the present fairness has no benefit.