American shale oil producer Chesapeake declared bankruptcy

Chesapeake Energy, one of the pioneers of the US shale industry, filed for bankruptcy and asked for protection for debt restructuring, the release said.

Earlier, the Bloomberg agency, citing sources, reported that Chesapeake Energy is preparing an application for potential bankruptcy, in which control of the company may pass to one of the main creditors. Before this, the media wrote that the company is planning to restructure its debt against the backdrop of falling oil and gas prices and is even preparing to launch bankruptcy proceedings.

“Chesapeake Energy Corporation today announced that the company has voluntarily filed for Chapter 11 (bankruptcy law) protection in the US bankruptcy court for the southern district of Texas to facilitate a comprehensive balance sheet restructuring,” the company said in a release.

Chesapeake will implement a reorganization plan to eliminate “approximately seven billion dollars of debt.”

The company has agreed with creditors, under which it will be granted a loan of $ 925 million. Also, creditors and holders of secured promissory notes must allocate $ 600 million to Chesapeake.

At the end of May, the International Energy Agency (IEA) in its report noted that the cost of shale oil production in 2020 in the United States would decrease by 50% compared to last year on the background of COVID-19. According to the Agency, the US has seen the most significant drop in energy investment this year – by more than 25% compared to 2019, mainly due to the oil and gas sector.

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