ATP Oil & Gas Corp. (ATPG) filed for bankruptcy in the face of falling production and a looming $89 million interest payment. The company arranged a $700 million revolving credit facility before making the filing.
The Chapter 11 petition listed $3.6 billion in assets and $3.5 billion in debt. The filing in U.S. Bankruptcy Court in the Southern District of Texas comes after Standard & Poor’s downgraded the company to CCC on Aug. 1, labeling it vulnerable to default.
The Houston-based oil and natural-gas firm has faced production delays as it tries to extract more oil from wells in the Gulf of Mexico. It has $1.5 billion of 11.875 percent notes due May 2015. In downgrading the firm’s credit rating, Standard & Poor’s said ATP won’t have money for the coupon payment on the notes and other planned spending unless it gets outside financing.
The company arranged financing from Credit Suisse Group AG, according to the court filing. ATP’s $89 million interest payment is due in November.
ATP’s stock closed at about 42 cents a share today, down about 98 percent since its peak at the end of October 2007.
Bluewater Industries LP and Nabors Offshore Corp. were listed as the company’s two largest unsecured creditors, according to court papers.
ATP’s $1.5 billion of 11.875 percent notes due May 2015 dropped to 29.4 cents on the dollar at 4:21 p.m. in New York, the lowest on record, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. Bondholders’ claims rank ahead of equity investors and behind secured lenders in a bankruptcy.
The bankruptcy case is In re ATP Oil & Gas Corp., 12-36187, U.S. Bankruptcy Court, Southern District of Texas (Houston).