Seventy Seven Energy Secures Approval of Judge to Exit Bankruptcy

by San Antonio Attorney

Seventy Seven Energy Inc., an oil-field-services provider based in Oklahoma, is setting up to exit bankruptcy following the confirmation of its reorganization plan by a bankruptcy judge.

The company has been allowed to gain access to $100 million in financing.

Delaware Bankruptcy Judge Laurie Selber Silverstein has approved the company’s reorganization plan, which would give bondholders owed more than $ 1 billion most of the rights in the business.  Seventy Seven Energy renders oil-field services like hydraulic fracturing and drilling.

The company’s unsecured debt would be completely paid off in the reorganization plan.

Seventy Seven Energy filed for bankruptcy on June 7, facing roughly $1.7 billion in debt.

The drastic decline in the prices of natural-gas due to excess supplies caused the company to struggle, as well as its business rivals.  From 2015 to June 30, a total of 85 oil and gas companies in North America have filed for bankruptcy.

The glut of oil supply in the market has been detrimental to Seventy Seven Energy’s earnings.  Court documents show that its revenue declined by $1 billion in 2015.

The management reduced its workforce from about 4,400 employees in 2014 to around 1,500 employees as of March 31.

Seventy Seven Energy’s has the largest land drilling fleet with 92 drilling rigs plus 13 hydraulic-fracturing fleets, which are used in many regions.

The company’s equipment is utilized by major exploration and production energy companies.  Its uncompleted work in drilling and hydraulic-fracturing from active contracts were about $255.2 million and $164.2 million, as stated in the documents submitted to the court.

The company was formed in 2014, after it left Chesapeake Energy Corp., which retained its services and supplied most of its income in the first quarter of this year.

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