Blaming volatility in the oil and gas markets, Vanguard Natural Resources has returned to bankruptcy for the second time in two years.
The exploration and production company, which counts reserves in the Gulf Coast basin of Louisiana among its assets, voluntarily filed for Chapter 11 bankruptcy April 1 in the Southern District of Texas, Houston Division as it works to restructure $882 million in debt.
In August 2017, Vanguard emerged from Chapter 11 after a bankruptcy reorganization and began selling assets, starting with properties in North Dakota and Montana.
The company is seeking court approval of $130 million debtor-in-possession financing, which contemplates $65 million in new money, up to $20 million of which will become immediately available, according to a statement the company issued yesterday. The remaining $65 million will roll up obligations for revolving loans under the company’s existing credit agreement. The arrangement—combined with the Vanguard’s cash from operations—is expected to maintain business operations during the bankruptcy proceedings.
“The restructuring steps that we have announced are necessary to attain a capital structure which is suitable for Vanguard’s assets and future business strategy,” R. Scott Sloan, president and CEO, said in the statement. “We are now focused on expediting an efficient in-court restructuring, maintaining our operational momentum and upholding our obligations to our employees and vital vendors and stakeholders.”
In addition to its properties in Louisiana, Vanguard maintains producing and nonproducing oil and natural gas reserves in Wyoming, Colorado, West Texas, New Mexico, Oklahoma, Alabama and Montana.