Milagro Oil & Gas filed for Chapter 11 bankruptcy this week, a day after Sabine Oil & Gas Corp. filed for the same protection. Milagro is one of seven oil & gas producers to restructure in the wake of low oil and natural gas prices. Credit rating agencies expect more to follow.
Court records show that Milagro reports that it has $1 million to $10 million in assets, and up to $1 billion in liabilities.
The company has 1,200 wells in South Texas, Louisiana and the Gulf Coast. It plans to sell its oil and gas properties and related liabilities to another Houston-based company, White Oak Resources VI for $217 million in cash and equity. White Oak drills for oil and gas in Southern Louisiana and South and East Texas.
Sabine Oil & Gas Corp. also sought Chapter 11 bankruptcy this week, making it the largest U.S. oil producer to file for bankruptcy protection.
Court records show Sabine has $2.48 billion in assets and $2.91 billion at the end of May, making this the second largest U.S. bankruptcy this year, according to data compiled by Bloomberg.
Sabine drills for oil and gas in the Haynesville shale in East Texas and Louisiana, the Eagle Ford Shale and the Granite Wash in Texas.
Companies blame plummeting oil & gas prices and high debt for the collapse, ultimately forcing financial capitulation.
Milagro, Sabine, Quicksilver, Saratoga Resources, BPZ Resources, Dune Energy and American Eagle Energy Corp. have all filed for bankruptcy protection this year. The companies employed a combined 745 workers at the end of last year according to the latest company data.