Gulfport Energy, a major player in Ohio’s Utica Shale, is expected to file for a Chapter 11 reorganization in the coming days, Kallanish Energy has learned.
The company, its revolver lenders and unsecured bondholders are expected to seek approval for a restructuring support agreement that includes debtor-in-possession financing.
The Oklahoma-based company is dealing with about $2 billion in debt.
The filing is expected in U.S. Bankruptcy Court in Houston, Texas.
The company has declined comment.
The company said it is continuing “ongoing constructive discussions with its lenders and certain other stakeholders regarding a potential comprehensive financial restructuring to strengthen the company’s balance sheet and financial position.”
That statement was part of a Gulfport filing on Friday with the U.S. Securities and Exchange Commission.
On the previous day, the company elected to go into a 30-day grace period and to defer making the interest payment due on Oct. 15 with respect to its 6.0% senior unsecured notes due 2024.
Gulfport said it has 30 days to make the interest payment before going into default.
Last August, Gulfport had indicated that it may not been able to survive as a going concern without a financial restructuring, said CEO David Wood.
In a related development, the company reported that it was notified on Oct. 8 that its borrowing base under the existing credit agreement had been reduced from $700 million to $580 million.
Last March, Gulfport hired investment bank Perella Weinberg Partners LP and its energy advisory arm Tudor, Pickering, Hilt & Co. to help study its options.
Gulfport has been dealing with the coronavirus pandemic, low demand and low commodity prices.
The company also has operations in the SCOOP play in Oklahoma.