American Eagle Energy Becomes Fourth U.S. Bankruptcy Of The Oil Bust.
The Colorado-based company that buys and develops oil wells in the Bakken oil fields of North Dakota and Montana filed for chapter 11 bankruptcy protection on Monday in Denver’s bankruptcy court. American Eagle Energy, which recently missed an interest payment on its debt, listed assets of $222 million and liabilities of $215 million.
Shares of American Eagle Energy traded for as much as $7.05 less than a year ago, reflecting the stunningly fast collapse of oil prices in recent months.
Still,
big financial busts generally produce many corporate bankruptcies. But
that has not been the case in the U.S. oil sector, where many
independent oil companies emerged in recent years and raised lots of
debt financing to drill for shale oil using new techniques like
horizontal drilling and hydraulic fracturing. Quicksilver Resources, BPZ Resources
and WBH Energy are the only other U.S. energy producers to file for
bankruptcy-court protection so far. Another independent oil firm, Sabine
Oil & Gas, has missed an interest payments and could be next.
Some oil companies may be
finding some financial relief with West Texas Intermediate crude
rebounding to $59 a barrel. A flood of hedge fund and private equity
money has also been raised to seize oil sector opportunities with some
of it already being deployed. Blackstone’s GSO credit division, for
example, committed $500 million to fund drilling programs for Linn
Energy and got an 85% working interest in some of Linn Energy’s oil and
gas wells in return.
forbes.
