Forty-six exploration and production companies and 61 oil-field service companies filed for chapter 11 bankruptcy last year, according to Haynes and Boone, a Dallas-based law firm tracking bankruptcies, the Houston Chronicle reported. The 107 oil and gas bankruptcies in 2020 were the most since 142 bankruptcies were filed during the last oil bust in 2016. Oil and gas companies have been hit hard by the coronavirus pandemic, which crushed global demand for crude and petroleum products such as gasoline and jet fuel. Unlike past downturns, oil and gas companies have been under increased financial pressure after many investors pulled out of the sector in 2018 after years of low-to-middling performance. Several energy companies said that they were forced to file for bankruptcy after lenders pulled credit lines as revenue dried up. More than a fifth of the bankruptcies last year — 14 exploration and production companies and nine oil-field service companies — brought more than $1 billion of debt to court. Multibillion-dollar bankruptcy cases were filed by Chesapeake Energy ($11.8 billion), Diamond Offshore Drilling ($11.8 billion) and California Resources ($6.3 billion). Ultra Petroleum filed for its second bankruptcy in five years, bringing $5.6 billion to court in 2020. Since the previous oil bust ended in 2016, oil and gas companies brought more than $286 billion of debt to court. During 2020 alone, more than $98 billion has been brought to court, compared with $70.3 billion during the previous oil bust, Haynes and Boone said. Read more.
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