Another oil and gas company has filed for bankruptcy protection, this time Houston-based Sanchez Energy Corp.
The company said the move follows a review of strategic alternatives to align its capital structure with the continued low commodity price environment.
“Sanchez Energy intends to use this process to substantially reduce its indebtedness and provide the financial flexibility to position the company for future success,” it said.
The company said it has sufficient liquidity to continue operating, including cash on hand and $175 million in new committed financing.
Sanchez’s legal counsel includes Akin Gump Strauss Hauer & Feld – partners Marty L. Brimmage Jr. and Lacy M. Lawrence in Dallas and David Elder and Patrick Hurley in Houston along with attorneys in the firm’s New York and Washington D.C., offices – and Jackson Walker, namely partners Matthew Cavenaugh and Elizabeth Carol Freeman in Houston and Jennifer Wertz in Austin.
Moelis & Co. is Sanchez’s financial advisor (Bassam Latif in Houston). Alvarez & Marsal managing director Jonathan Hickman in Charlotte is its restructuring advisor.
Morgan Lewis is representing Korea National Oil Co. affiliate Eagle Ford TX LP in the case, including Boston attorneys Amy Kyle, Julia Frost-Davies and Laura McCarthy. Evercore is representing the company’s secured noteholders, including Dan Aronson in Chicago and Greg Berube in New York.
The unsecured creditors are being advised by Quinn Emmanuel partners Patty Tomasco and Christopher Porter and associate Devin van der Hahn in Houston, along with two attorneys in the firm’s New York office, and PJT Partners’ Peter Laurinaitis in New York.
As The Texas Lawbook previously reported, Sanchez said last month in regulatory filings that it was working on a restructuring plan to cut debt and strengthen its financial flexibility. It said it had delayed making a $35.2 million interest payment on its 6.125 percent senior notes due 2023, which have a 30-day grace period that expires Aug. 14.
The oil and gas explorer has been exploring strategic options since this past fall with Moelis advising it.
Sanchez follows other oil and gas companies into bankruptcy court, including Halcón Resources, which filed for Chapter 11 for a second time last week; Weatherford International and Legacy Reserves, which filed last month; and Vanguard Natural Resources and Jones Energy, which filed earlier in the year.
For more on the bankruptcy, read the story on the Houston Chronicle, which is a partner of The Texas Lawbook.