Page 17 - MEOG Week 26

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Meanwhile in Peru, indigenous leaders are Lawler, who also tried to pivot the firm towards
concerned that their efforts to secure legal pro- oil production. The move proved ill-timed, as
tection for their territory in the Amazon region, two collapses in oil prices since 2014 have slowed
near the borders with Brazil and Ecuador, will Chesapeake’s debt-reduction efforts and affected
spark opposition from the oil industry. The the profitability of its new oil assets.
country’s legislature is currently mulling propos- In a June 28 statement, Chesapeake said the
als to fast-track a bill upholding the indigenous restructuring support agreement it had reached
group’s aim. with its lenders will allow it to eliminate around
Guyana, South America’s newest oil pro- $7bn of its debt.
ducer, has shortlisted 19 of the 35 companies For its part, Lilis had $115mn in debt under
that submitted offers to act as marketing agent its revolving credit agreement as of the end of
for five crude cargoes over a period of 12 months. 2019. The company, which is a pure-play Per-
The list of bidders moving on to the next stage of mian Basin producer, announced this week that
the tender includes two Chinese companies and the restructuring plan it had agreed with credi-
three major commodities trading firms. tors would eliminate almost $35mn of its debt.
Lilis cited the downturn in commodity prices
if you’d like to read more about the key events shaping during the coronavirus (COVID-19) pandemic
the latin American oil and gas sector then please click as the reason for its Chapter 11 filing, saying it
here for NewsBase’s latAmOil Monitor. had explored a variety of options for cutting
costs, improving its liquidity and addressing Chesapeake and
north american shale shifts debt maturities.
Two high-profile shale drillers, Chesapeake The companies are the latest in a growing list Lilis are the latest
Energy and Lilis Energy, have filed for Chapter of bankruptcies in the North American oil and
11 bankruptcy protection, having been hit hard gas industry since 2015, many of which are shale in a growing list
by the collapse in crude prices. drillers.
In Chesapeake’s case, the filing has long been According to law firm Haynes and Boone, of bankruptcies
awaited; analysts have been predicting that the more than 200 North American oil and gas in the North
company would enter bankruptcy proceedings producers, owing more than $130bn in debt
since oil prices began to crash in March. Indeed, collectively, filed for bankruptcy between the American oil
the company was struggling prior to that to pay beginning of 2015 and May 2020. This year
down its debt, valued at $9.5bn at end-2019. alone, at least 20 companies had gone bankrupt and gas industry
Chesapeake made a name for itself as one of by May.
the pioneers of the shale gas revolution, racking since 2015
up billions of dollars’ worth of debt in the pro- if you’d like to read more about the key events shaping
cess. The company had been trying to pay down the North American oil and gas sector then please click
its balance under the leadership of CEO Doug here for NewsBase’s NorthAmOil Monitor.™

Week 26 01•July•2020 www. NEWSBASE .com P17