SandRidge Energy, Inc. (fka SDOCQ)

[~ Blue ~]

WSJ: SandRidge Energy Files for Bankruptcy Protection
Oklahoma City oil and gas company becomes latest victim of downturn in energy sector


SandRidge joined the ranks of oil and gas drillers to file for bankruptcy in recent weeks. ENLARGE
SandRidge joined the ranks of oil and gas drillers to file for bankruptcy in recent weeks. Photo: Reuters
By Patrick Fitzgerald
May 16, 2016 9:17 a.m. ET
0 COMMENTS

SandRidge Energy Inc. became the latest victim of the prolonged downturn in energy sector, filing for bankruptcy protection Monday after reaching a deal with its creditors to swap $3.7 billion in debt for control of the oil and gas company.

The Oklahoma City company filed for chapter 11 protection in U.S. Bankruptcy Court in Houston after reaching a deal with the majority of its lenders and bondholders on the terms of a “prearranged” debt restructuring pact.

SandRidge Chief Executive James Bennett said the proposed debt swap, which requires court approval, will allow the reorganized company to concentrate on oil and gas exploration and development in our active Oklahoma and Colorado project areas.

The company will stay open during the chapter 11 case and expects to exit bankruptcy “with minimal disruption to our business,” Mr. Bennett said.

SandRidge says it has enough cash to fund its ongoing operations without a bankruptcy loan. Among its initial bankruptcy request is the authority to pay operating expenses associated with production activities, royalties and wages to its workers. The company also intends to pay all suppliers and vendors in full during the bankruptcy.

SandRidge joins the ranks of oil and gas drillers to file for bankruptcy in recent weeks as the low oil prices continue to roil the energy sector. Linn Energy, Midstates Petroleum Co. and Ultra Petroleum Corp. have all recently filed for bankruptcy in Texas. Also, Breitburn Energy Partners LP filed for bankruptcy Monday in New York.

Those companies join Samson Resources Corp., Magnum Hunter Resources Corp., Emerald Oil Inc., Swift Energy Co. , and dozens more that had earlier sought bankruptcy.

SandRidge drills for oil and gas in Oklahoma, Kansas and Texas, where it has 4,411 gross producing wells and more than 2 million gross acres under lease. As of Dec. 31, it had four rigs in operation.
Advertisement

At the end of last year, the company employed more than 1,100 people but has since reduced its head count to 864. The company listed assets of $7 billion and debts about $4 billion in papers filed with the bankruptcy court.

The law firm Kirkland & Ellis LLP is handling the chapter 11 case, and Houlihan Lokey, Inc. is SandRidge’s financial adviser.

—Stephanie Gleason contributed to this article

Write to Patrick Fitzgerald at [e-mail]


http://www.wsj.com/articles/sandridge-energy-files-for-bankruptcy-protection-1463404621