Whiting Petroleum declared it has achieved an settlement with noteholders to go after a consensual monetary restructuring after submitting for Chapter 11 defense in the U.S. Bankruptcy Court docket for the Southern District of Texas.
The shale producer at a person time was the most significant oil producer in North Dakota’s Bakken location with a industry cap of $fifteen billion in 2011. It was expected to produce about 42 million barrels of oil equivalent in 2020.
West Texas Intermediate was trading at $20 per barrel Wednesday morning.
“In 2019, we took proactive steps to minimize our expense framework and boost our cash movement profile. We continue to make on these steps in 2020,” Whiting’s chairman and main government officer Bradley Holly explained in a statement. “The firm has also explored a vast wide variety of alternate options to handle our equilibrium sheet and looming observe maturities in a extremely money constrained industry setting.”
Holly cited the uncertainty about the Saudi-Russian cost war and the coronavirus pandemic in earning its determination.
The firm explained its reorganization program would deleverage its money framework by over $two.two billion by exchanging all of its notes for 97% of the new equity in a reorganized firm. It explained it expects to have adequate liquidity to meet its monetary obligations for the duration of the restructuring with no the will need for further funding.
Whiting experienced $two.eight billion in credit card debt and extra than $585 million in cash on its equilibrium sheet as of Dec. 31.
“We believe that this monetary demise was due to a combination of hard macro ailments put together with sub-par operations for several quarters,” SunTrust Robinson Humphrey analyst Neal Dingmann explained.
Shares of Whiting Petroleum were being down 44%.