Bankruptcy attorneys in Houston Texas are keenly interested in bankruptcies in the oil and gas sector. Debt levels and bankruptcy cases in one of Texas’s biggest industries tend to show indicators of the state’s economic health as a whole. While the previous quarter shows a significant decrease in oil and gas bankruptcies, will the trend continue?
Record Year of Bankruptcies
Many Texans remember that the Texas Oil and Gas industry was in great peril in 2015 and 2016. In 2015, 44 oil and gas producers in the US filed for bankruptcy, which equated to some $17 billion in debt. Two thousand sixteen didn’t show much more promise with some of the largest oil and gas companies in Texas filing bankruptcy including Ultra Petroleum Corp. and Pacifica Exploration & Production Corp. In the two years combined, over 100 North American oil and gas companies filed for bankruptcy protection. As 2019 brings hope for a brighter future, bankruptcy numbers from Q4 of last year show much promise as only two energy companies filed bankruptcy in the Southern District of Texas.
Oil & Gas: 2018 Texas Bankruptcies
In total, only 43 oil and gas companies in North America filed for bankruptcy, which is a nearly 50% decline from the previous number of 70. A few of the largest Houston Texas bankruptcies in 2018 within the oil and gas sector came from EV Energy Partners, Fieldwood Energy, Parker Drilling, and Erin Energy. The only two oil and gas bankruptcies filed in the Southern District of Texas in the fourth quarter of 2018 were Petroquest Energy Inc. and Parker Drilling Co.
Future O&G Bankruptcies?
AS 2019 begins, there are a few companies that are in danger of being delisted from major stock exchanges including Sanchez Energy, EP Energy, Weatherford International, and Camber Energy. While the worst may be over for North American oil and gas companies, there has been a steep decline in oil prices over the last three months that could be to cause pain for Texas companies once again.
Texas Business Bankruptcies
Companies in any industry have the right to restructure their business debts under Chapter 11 bankruptcy. With this legal protection in place, companies experiencing overwhelming debt without the sufficient revenue to pay back vendors should meet with a Houston bankruptcy attorney to explore their options and find out if bankruptcy protection will allow the company to remain in business while working to renegotiate a payment plan with creditors.