• 2 minutes Rational analysis of CV19 from Harvard Medical School
  • 4 minutes While U.S. Pipelines Are Under Siege, China Streamlines Its Oil and Gas Network
  • 7 minutes Renewables Overtake Coal, But Lag Far Behind Oil And Natural Gas
  • 7 hours Tesla Begins Construction Of World’s Largest Energy Storage Facility
  • 5 hours Joe Biden the "Archie Bunker" of the left selects Kamala Harris for VP . . . . . . Does she help the campaign ?
  • 3 hours Will any journalist have the balls to ask Kamala if she supports Wall Street "Carried Interest" Tax Loophole
  • 1 day Trump Hands Putin Major Geopolitical Victory
  • 6 hours America Could Go Fully Electric Right Now
  • 1 min Buying votes is cool now.
  • 1 day Those Nasty White People and Camping Racism
  • 5 hours In 1,267 days, Trump has made 20,055 false or misleading claims
  • 17 hours .
  • 13 hours The Truth about Chinese and Indian Engineering
  • 16 hours Brent above $45. Holding breath for $50??
  • 23 hours COVID&life and Vicious Circle: "Working From Home Is Not Panacea For Virus"
  • 16 hours The World is Facing a Solar Panel Waste Problem
  • 2 days Oil Tanker Runs Aground in Mauritius - Oil Spill
  • 2 days China wields coronavirus to nationalize American-owned carmaker
How COVID Relief Saved Texas Shale Jobs

How COVID Relief Saved Texas Shale Jobs

Four months ago, Congress approved…

Shale Giant On The Brink Of Bankruptcy Receives Federal Lifeline

The federal government has allowed bankrupt shale major Chesapeake Energy to stop drilling at more than 100 leases on federal lands without losing ownership of the assets, Reuters has reported, citing data that shows the approvals have been granted since the start of the coronavirus crisis.

The company, according to the data, first applied for permission to suspend drilling across these leases in late April. By mid-May, the Bureau of Land Management had granted it 108 approvals, Reuters reports. The BLM has been granting permission to oil companies to suspend drilling in federal leases without losing their ownership on a case-by-case basis.

However, the suspensions are not indefinite. Most of them expire at the end of this month, Reuters noted. While the BLM could grant an extension, it is unclear whether it can grant one to a company that is effectively bankrupt.

Last week, media reported, citing unnamed sources, that Chesapeake was preparing to file for Chapter 11 bankruptcy protection after it missed a bond payment due Monday, June 15. The missed deadline was the beginning a grace period for negotiations with bondholders, but the company has decided to file for Chapter 11 protection instead, in the coming weeks.

If the bankruptcy filing materializes, it would make Chesapeake the largest shale player to date to go under in the current crisis. But this is not the first time the company has had dramatic troubles. During the last crisis, between 2014 and 2016, Chesapeake risked bankruptcy, but managed to avoid court proceedings through a series of out-of-court debt exchanges.

Chesapeake reported a net loss of $8 billion for the first quarter, up from a net loss of $21 million a year earlier. Its stock and bond prices were pummelled to the ground by the oil price war and the pandemic like the stocks and bonds of so many others but, as many warned, those with the largest debt burdens would be the first to go.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News