Emerald Oil hit by oil prices goes for Chapter 11 bankruptcyStaff writer ▼ | March 23, 2016
Emerald Oil and its subsidiaries filed voluntary Chapter 11 petitions. The company has obtained $20 million in post-petition debtor in possession financing.
Oil industry The only path for Emerald
McAndrew Rudisill, president and chief executive officer of Emerald, said, "The plan we are announcing today will provide for continuity in Emerald's current and future business operations. This process is the only path going forward and should enable the business to execute a turnaround in the current low oil price environment.
"Importantly, Emerald's plan and the Latium transaction would allow the business to continue to operate and would provide a sound path for potential recovery for Company stakeholders."
Like many other exploration and production companies, Emerald's operations have been significantly impacted by the dramatic decline in oil prices, the continued low prices of oil and natural gas, and the general uncertainty in the energy markets.
These macro-economic factors, coupled with Emerald's substantial debt obligations, resulted in the Company's decision to explore strategic restructuring alternatives to reduce its debt and achieve a sustainable capital structure.
Over the last nine months the company explored and presented multiple solutions to its lenders to solve the company's current financial condition, however the company was unable to obtain the requisite lender consent.
Emerald continues to evaluate and discuss alternatives with its stakeholders and believes that an in-court sale process will maximize value and position Emerald for future profitability. ■