Survivors of Oil and Gas Market Slump at Risk of Filing Bankruptcy Again

by San Antonio Attorney

At the main office of Global Geophysical Services LLC in Houston, Texas, some of its workers are gradually closing down what is remaining of a data provider for gas and oil industry that use to employ than 1,000 people.

The company is filing its second Chapter 11 bankruptcy after the first one failed to solve their problems.

A victim of huge debt and insufficient funds, the Global Geophysical filed for Chapter 11 protection in 2014 before plummeting oil prices caused many other energy companies to collapse.  In 2015, the firm became one of almost 20 companies in the industry that have already emerged bankruptcy, but is currently among those that have sought for creditor protection one more.

Reorganization experts say that Global Geophysical is experiencing a relapse because it was unsuccessful in wiping out their debts in a bankruptcy.

In the previous bankruptcy of Global Geophysical, a disagreement among creditors was partly caused by over $100 million in debt that cannot be eliminated, according to sources of report.  That proved unbearable in a present unstable market and resulted in the liquidation of the company.

Some creditors turned down an offer to trade all debt into shares, cautious of more damage from the crash, or plans that were extremely positive.  Bankruptcy judges have been criticized for their penchant to concentrate on working out a deal without carefully assessing the companies’ likelihood of long-term continued existence.

An estimated 200 energy companies have sought for bankruptcy protection starting in 2015, according to reports.  Out of those that have debt loads of about $450 million, almost 20 have exited bankruptcy.

Some firms reduced their debt to a small portion of their expected earnings, according analysts.

If you need Bankruptcy Help, you need to talk to an experienced lawyer who can assess your case and unique situation.

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