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Shareholders won’t get an official voice in the bankruptcy of SunEdison Inc. because the company is “hopelessly insolvent,” with debts outweighing assets by at least $1 billion, a bankruptcy judge has ruled, the Wall Street Journal reported today. The decision from Judge Stuart Bernstein followed a court fight aimed at proving the solar-power developer has enough value left to offer hope that shareholders would avoid a wipeout in bankruptcy. Judge Bernstein, who has presided over SunEdison’s chapter 11 case from its start in April, said that it is “substantially unlikely” the company would be able to pay off its debts. Even working with book values on paper and estimates of what asset sales would bring, SunEdison would come up from $1 billion to $2.5 billion short of debts, the judge said. The judge turned down a request for an official committee to represent shareholders in SunEdison’s bankruptcy case, a bid that was driven in part by shock over the rapid decline in value in the company.

Houston-based Sabine Oil & Gas Corp. emerged from bankruptcy yesterday after more than a year after it filed, the Houston Business Journal reported yesterday. The exploration and production company also closed on its new senior secured credit facility, which has an initial borrowing base of $150 million, and on its new $150 million second lien term loan. Sabine’s chapter 11 reorganization included a debt-for-debt exchange, a debt-to-equity conversion and the issuance of warrants to purchase stock in Sabine’s new parent holding company. According to Sabine’s July 2015 chapter 11 filing with U.S. Bankruptcy Court for the Southern District of New York, the company had $2.48 billion in assets and nearly $2.91 billion in liabilities as of May 31, 2015. Read more.

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Lenders owed more than $700 million have called for an independent trustee to take over a bankruptcy liquidation of China Fishery Group, which they have accused of stalling efforts to repay them, the Wall Street Journal reported yesterday. In court papers filed on Monday with the U.S. Bankruptcy Court in Manhattan, lawyers for the lender group said they see “grave risk” in allowing the family that founded and controls the company — the Ng family — to remain in charge. “The need for transparency and independent oversight has been a substantial concern of the [lenders] for some time,” they said. “The stakeholders have lost all faith in the Ng family properly using chapter 11 to best serve creditors’ interests.” Ng Puay Yee, the company’s chief executive officer, has hinted that lenders may try to wrest control of the company away from its current management. In court papers filed in June when China Fishery sought chapter 11 protection, Ng said his business was “in jeopardy as a result of the aggressive and improper acts by certain lenders.”

A Schenectady, N.Y., asbestos removal company has filed for chapter 11 protection, the Albany Times Union reported today. Precision Environmental Solutions appears to have been extremely successful in years past, with more than $7 million in revenue between 2014 and 2015. However, documents filed this week in U.S. Bankruptcy Court in Albany show that the company earned only $175,000 this year. The company appears to have vacated space at the Rotterdam Industrial Park back in April, which may be the reason why it is a defendant in a breach of lease lawsuit filed against it by Rotterdam Ventures, a subsidiary of the Galesi Group that owns the industrial park. Precision Environmental Solutions also lists legal action against it involving SUNY Plattsburgh and the U.S. Environmental Protection Agency, although no details were given.

Peabody Energy Corp. said top lenders accepted its reorganization plan, a key milestone in the coal miner’s chapter 11 restructuring, Dow Jones Newswires reported yesterday. Peabody said yesterday that the lenders behind its $800 million bankruptcy financing package accepted its five-year business plan, disclosed in a filing with the U.S. Securities and Exchange Commission. The 2017-21 outlook will form the basis for a chapter 11 plan of reorganization that the coal giant hopes to submit to the bankruptcy court by the end of the year. The company faced a deadline of today to submit the reorganization plan for lenders’ approval or risk being declared in default of the loan.

Rincon Island LP, an oil and gas production company, has filed for bankruptcy protection to block the state of California from forcing the company to perform extensive remediation on its wells amid environmental concerns, the Wall Street Journal reported today. The company filed for chapter 11 protection on Monday with the U.S. Bankruptcy Court in Dallas as California’s Natural Resources Agency issued an emergency order mandating the environmental safety work on Rincon Island’s idle properties, including installing plugs and shut-off valves on certain wells. The order requires Rincon to pay for the extensive remediation. The report prompted a call from state Sen. Hannah-Beth Jackson urging California to close the facility completely. She cited the lack of progress Rincon Island has made to address safety troubles. “Despite being warned of this and other issues on Rincon Island on numerous occasions — including deteriorated wellheads and a lack of regular maintenance — RILP has consistently failed to meet milestones,” Sen. Jackson said in her letter. Rincon Island said in a statement that it filed for bankruptcy “in order to protect its key oil and gas leases from a wrongful attempted termination by the state of California. The partnership will be reorganized in order to ensure its long-term financial success.” Read more. (Subscription required.)

Get a better understanding of what happens when an oil, gas or other natural resources company goes bankrupt. Order your copy of ABI's revised and expanded When Gushers Go Dry: The Essentials of Oil & Gas Bankruptcy, Second Edition.