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Bankruptcy Watch: 4/15/16

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As banks complete their Spring re-determination, the process where banks calibrate their credit levels for producers, the squeeze of 10-30% reductions are being felt as a growing number of producers have delayed their 10k reporting due to pending credit agreement defaults which need to be resolved in order to continue as a going concern.  This week the following companies have announced, or indicated, they are pursuing some form of restructuring:

 

 

Energy XXI filed for Bankruptcy protection after invoking their grace period a few weeks back.  The company has pre-negotiated a plan to reduce the majority of their $2.9B debt in exchange for new equity.  On June 30th, 2015, the company sold the Grand Isle Gathering System (GIGS) for $245MM toCorEnergy where EXXI would continue to operate their main gathering system, in return for an 11 year triple net lease agreement with CorEnergy, with annual minimum rents averaging $40.5MM for the term.   In the Chapter 11 filing, Grand Isle Corridor LP, Exterran LP, and Archrock LP are listed as creditors with undisclosed trade debts with Energy XXI.

 

Midstream Providers:  CorEnergy, Exterran LP, Archrock

 

 

Breitburn Energy Partners announced that it has suspended any further payments on their Perpetual Preferred units as well as a $33.5 million due on their senior notes.  During their grace period, the partnership has retained restructuring advisors to explore strategic alternatives.  The Partnership terminated their common unit distributions in August 2015.  Plains Marketing accounted for 12% of Breitburn's $1.1B of revenue in 2015.  

 

Midstream Providers:  None disclosed in 10k

 

 

Goodrich Petroleum disclosed that they have filed for Chapter 11 in a pre-packaged deal where creditors have agreed to eliminate $400MM in debt.  The announcement mentioned that they company expects to pay vendors and suppliers in full under normal terms, before and after the restructuring

 

Midstream Providers:  None as disclosed in 10k

 

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