On May 15, 2020, Gavilan Resources, LLC and three (3) affiliated companies (collectively, the “Debtors”) filed petitions in the United States Bankruptcy Court for the Southern District of Texas, Houston Division seeking relief under chapter 11 of the United States Bankruptcy Code. The Debtors’ cases have been assigned to Judge David R Jones. The Debtors are seeking to have their cases jointly administered for procedural purposes, meaning that upon entry of such order, all pleadings will be maintained on the case docket for Gavilan Resources, LLC, Case No. 20-32656 (the “Main Case Docket”). The Main Case Docket can be accessed through the website maintained by the United States Bankruptcy Court for the Southern District of Texas, Houston Division (https://www.txs.uscourts.gov). An unofficial version of the Main Case Docket is accessible at this link: Epiq 11
The cases are being jointly administered; there is no deadline set for filing proofs of claim, and there is no prepackaged reorganization plan.
The Debtors filed an emergency motion to lift stay to proceed with their litigation against their development partners, who, Gavilan asserts, are in default of their agreements and therefore not entitled to continue to operate or otherwise participate in the Comanche Assets that Gavilan and its partners purchased from Anadarko. An Order was entered granting that Motion and the stay was lifted. The adversary defendants are themselves in bankruptcy.
Gavilan Resources, LLC - The latest development in this case is the filing of the Debtors’ Master Service List on May 27.
Chisolm Oil and Gas filed Chapter 11 in Delaware on June 17. A Scoop Stack operator in Oklahoma primarily.
Here is one article on the filing, and sounds like a pre-packaged Chapter 11. No word specifically if they intend to pay royalty owners without interruption.
Chisolm Ch 11
Recent filings in the Gavilan Chapter 11.
Link
Here is the Chisolm petition. Omni is the noticing agent.
Link
Here is the summary page for Ultra, which is also on primeclerk.com
Link
A handy summary on the Unit Chapter 11 with some of the deadlines. There are several different free services that post all the filings, including primeclerk.com, and several others.
Link
2 Likes
The big one we have been expecting filed - Chesapeake Chapter 11 in Houston. They have already filed for approval to continue to pay royalty owners. Here is the filing, Emergency Order (hearing is today), and request to extend the deadline to file schedules.
2020-06-28 Chapter 11 Voluntary Petition.pdf (709.8 KB)
2020-06-28 Motion for Order regarding Mineral Payments.pdf (547.6 KB)
2020-06-28 Motion for Order Extending Deadline for Schedules.pdf (759.9 KB)
Sable Permian Resources LLC filed Chapter 11 in Houston. Same as Chesapeake, they expect to reorganize and to pay royalty owners during bankruptcy.
Royalty Owner FAQs.pdf (100.9 KB) 2020-06-25 Chapter 11 Petition.pdf (1.8 MB)
2020-06-25 Motion to Pay Mineral Payments.pdf (665.3 KB)
2020-06-26 Order Authorizing Mineral Payments.pdf (317.9 KB)
Lillis Energy has filed Chapter 11 in Houston. Press release says they plan to continue operating and paying owners. This is a small company, so suggest keeping an eye on it if they are paying you.
Ch 11 Petition - Lilis Energy.pdf (1.5 MB)
Lilis Energy Voluntarily Files for Chapter 11 Bankruptcy _ Lilis Energy.pdf (53.3 KB)
List of Lilis Entities.pdf (164.9 KB)
Order for Joint Administration.pdf (157.5 KB)
Proofs of claim in Epiq case are due July 24.
Order Setting Deadline for Claims.pdf (2.3 MB)
Rosehill Resources has filed Chpater 11 in Houston. Looks like a pre-packaged bankruptcy.
2020-07-01_Rosehill_Resources_Inc_and_Rosehill_Operating_66.pdf (100.6 KB)
Sable filed a motion to authorize it to continue to pay royalty owners and looks to be selling many of its assets.
See above for the link for the Prime Clerk docket sheet.
Wade,
Thanks for keeping us updated! Appreciate it.
1 Like
I just found out about this link. Haynes and Boone has a bankruptcy monitor report. I have no affiliation with them. Found the graphs and case numbers useful.
https://www.haynesboone.com/-/media/Files/Energy_Bankruptcy_Reports/Oil_Patch_Bankruptcy_Monitor
Ultra got their interim financing of $25 million approved.
Final Order on Financing.pdf (3.8 MB)
Unit filed their schedule and statement of affairs. Too lengthy to post here, so see earlier posts on how to access the docket sheet.
MDC has filed a 3rd motion to extend the time to file their Chapter 11 plan from July 31 to October 31.
Seems like they are struggling getting support for their reorganization plan.
2020-07-17 - MDC - 3rd Motion Extending Deadline to File Plan.pdf (349.4 KB)
On all of these Chapter 11s where you are being paid and the company is promising to continue to pay, you should still ask yourself the following questions (just a guideline - many chapter 11s also allow certain royalty owner claims to survive the bankruptcy and not be discharged, but you have to delve into the details of the bankruptcy to figure this out):
- Was the company current on my royalty payments?
- Have I checked to make sure no additional wells were drilled they had not started paying me on yet?
- Was the company in breach of any provisions in my lease?
- Had the company taken any improper deductions from my royalty payments?
- Were there any payments in suspense, or wells I was not being paid on, due to title issues?
- Were there any other overdue payments under the lease, e.g. extension options?
- Did the company owe me a release, partial release or depth severance release on an expired lease?
- Did the lease involve old wells not producing in paying quantities where I may have been able to get the lease terminated?
- If I also owned the surface, was I owed any surface damage payments?
- Were there any easement payments that I was owed, where they had already built the improvement and we were working out the easement agreement?
- Was I owed any seismic permit payments?
- Did I have any claims that the operator should have drilled offset wells?
- Had a horizontal well been drilled where they were using a production allocation formula I did not think was correct?
- Was I owed any lease bonuses that had not been paid or were going to come due during the bankruptcy?
- Will I be owed any payments from a regular source of income, i.e. water sales?
- Is there anything I am wanting to do that the lease may prohibit or restrict without their consent, i.e. selling minerals where the lease gives them a right of first refusal?
- Is there any unmitigated work they were supposed to do, i.e. plugging wells, cleaning up pits, etc.?
- Is the company current on my SWD payments, and are those covered in the interim orders that are being entered?
- Was this bankruptcy filed in Delaware, where they may try to argue I am not a secured creditor?
Remember, a No answer to all of these does not mean the court notices can go in File 13. Approach a bankruptcy as a potential threat to any claim you have, or know you are going to have soon, against an operator. It can also be an easier, cheaper, and opportune time to get them resolved, as the whole focus of a bankruptcy court, as compared to a state court lawsuit, is to get claims resolved and to try to get the company back on its feet or sold.
5 Likes