Endeavour International Corp., a US-based oil and gas exploration firm with operations in the North Sea, sought bankruptcy protection yesterday, saying it has a restructuring agreement with some creditors.
The company’s debt totals about $1.2billion, according to Chapter 11 papers filed in US Bankruptcy Court in Wilmington, Delaware. More than $500million of that resulted from “unexpected events” in the past three years, according to the filing.
More than two-thirds of holders of some notes have approved a restructuring support agreement that would reduce debt by $568million, Houston-based Endeavour said in a statement. The common stock will be canceled, while new debt and shares will be issued to the noteholders.
The company blamed “natural disasters, adverse and unforeseen operating issues, delays in new production coming online and operating difficulties particular to the North Sea” for a sudden rise in costs.
“Its two large North Sea developments, Bacchus and Rochelle, were each over a year delayed in coming to first production, which caused cost overruns,” according to the statement. That “substantially impacted the cash flow and operating margins the company would have received.”
Among the largest unsecured creditors listed in court papers were holders of $404 million in notes under the trust of Wells Fargo Bank, $150million with Wilmington Trust as trustee, and $135million with Wilmington Savings Fund Society as trustee.
The main case is In re Endeavour Operating Corp., 14-12308, U.S. Bankruptcy Court, District of Delaware (Wilmington).