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Whiting Petroleum Files for Bankruptcy

Gasoil News - Published on Thu, 02 Apr 2020

Image Source: Whiting Petroleum Coronavirus Lockdown
The unprecedented collapse in global oil markets brought another driller to its knees, forcing a champion of what was once the premier US shale field to seek protection from creditors. Whiting Petroleum Corp has filed for bankruptcy, as the company concluded that given a severe downturn in oil and gas prices resulting from the Saudi Arabia-Russia oil price war and COVID-19-related impact on demand a financial restructuring was the best path forward. Whiting said it has reached an agreement in principle with certain note holders to pursue a comprehensive and consensual financial restructuring. The bankruptcy will provide for a de-leveraging of its capital structure by over USD 2.2 billion, payment or refinancing of its revolving credit facility, payment of all other secured lenders and employees and for existing stockholders to receive 3% of the new equity in the reorganized company.

The company said it has sufficient liquidity including USD 585 million in cash, to keep operating its business and to meet financial obligations during the restructuring without the need for additional financing.

Once the largest oil producer in North Dakota’s Bakken shale region, Whiting lost money in four of the last five years and spiraled deeper into debt just as the Covid-19 outbreak crushed energy demand. The company’s Bakken primacy won it little praise because the region was already falling out of favor as drillers shifted to lower-cost prospects in the Permian Basin.

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Posted By : Yogender Pancholi on Thu, 02 Apr 2020
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