Virtual Special Institute

Bankruptcy and Financial Distress in the Oil & Gas Industry: Legal Problems and Solutions

  1. ALEX RITCHIE

    Executive Director Rocky Mountain Mineral Law Foundation, Westminster, CO
  2. GREGORY J. NIBERT

    Partner Hinkle Shanor LLP, Roswell, NM

Introduction and Opening Remarks

  1. SARAH LINK SCHULTZ

    Akin Gump Strauss Hauer & Feld, Dallas, TX
  2. MATTHEW WARREN

    King & Spalding, Chicago, IL

Strategic Paths for Oil & Gas Companies in Distress

  • Considerations based on company risks, company and asset values,liquidity, and capitalization
  • Out of court options, including new investment, forbearance,consensual restructurings, and foreclosure
  • Pros and cons and types of bankruptcy and financing during case
  • Bankruptcy filing and venue selection and jurisdictional concerns

Break

  1. Mark L. Burghardt

    Partner Dorsey & Whitney, LLP, Salt Lake City, UT
  2. H. JOSEPH ACOSTA

    Dorsey & Whitney, Dallas, TX

Alternatives for Managing Financial Distress in the Oil Patch

  • Bankruptcy financing issues
  • The need for liquidity
  • Use of mezzanine financing, traditional and volumetric productionpayments, net profits interests, equity kicker deals, and preferred stock
  • Working with lenders and credits and avoiding default and foreclosure
  • Prioritizing obligations and assets, including contractual obligationsand drilling to hold leases

Break

  1. JESSICA PEET

    Senior Associate Vinson & Elkins, New York, NY

Bankruptcy Basics for the Oil & Gas Industry

  • The automatic stay and its exceptions
  • Important differences between Chapter 7, 11, and 13 proceedings
  • Administration and governance, including fiduciary obligations, insurance, and other issues
  • Temporary extension of deadlines and limitations periods
  • United States Trustee, including duties and obligations

Break

  1. ELI COLUMBUS

    Haynes & Boone, LLP, Dallas, TX

Operational Issues in Times of Distress

  • Keeping leases and contracts, including farmouts and termassignments, alive
  • Rejection of JOAs, PSAs, midstream, and other contracts
  • Effect of automatic stay on state proceedings such as spacing, forcedpooling, and unitization
  • How to protect the debtor’s assets and operations during bankruptcyproceedings
  • Treatment of tax liens and past due royalties owned to governmententities
  • What bankruptcy counsel needs to know about the debtor’s operations

Break

  1. PAUL J. LOPACH

    Bryan Cave Leighton Paisner LLP, Denver, CO

Force Majeure and Contractual Savings Clauses

  • How force majeure clauses differ and the implications of drafting
  • Other savings clauses and how they may avoid the need for bankruptcy
  • Suspension of operations and production
  • Amending leases and JOAs

Virtual Networking Reception

Join your colleagues for virtual networking! Come and enjoy some intimate conversations with multiple small group breakout “rooms”. Log in to Zoom with your unique link and join the main reception. From there move to your breakout room and contribute for 30 minutes before moving on to your next breakout room where you will have the opportunity to network with a new group of fellow attendees. 

  1. CAMERON BETTIS

    Simpson Thatcher & Bartlett LLP, Houston, TX

Collateral Security for Oil & Gas Financing Transactions

  • Obtaining and perfecting security interests in oil and gas properties and production
  • Mortgages and deeds of trust
  • Fixture filings and perfecting liens on equipment, pipelines, andproduction facilities
  • Perfecting a security interest in commingled oil and gas
  • Title due diligence

Break

  1. BERNARD R. GIVEN II

    Loeb & Loeb LLP, Los Angeles, CA

Chapter 11 Administration and Plan Confirmation

  • The role, powers, and considerations for joining creditors’ and other committees
  • Debtor’s rights, including operating rights and right to propose a plan
  • Provisions of plans, including payment term, classification of claims, lien modifications, corporate governance, and discretionary provisions
  • Confirmation issues, including voting by creditors, comparison to liquidation, and the Absolute Priority Rule

Break

  1. MICHAEL P. COOLEY

    Reed Smith LLP, Dallas, TX

Claim Priorities in Bankruptcy and Favorable Claim Types

  • Treatment of revenues, including trust status and runs to be disbursed
  • Priority of statutory and contractual liens
  • Priority of claims arising under executory contracts
  • Administrative expenses and priority claims

Break

  1. IAN E. ROBERTS

    Shearman & Sterling LLP, Dallas, TX

Executory Contracts and Unexpired Leases

  • Are contracts such as oil and gas leases, commercial leases, JOAs, surface use, and compensation agreements contracts, and are they executory?
  • Assumption verses rejection, including the duty to assume or reject and the effect of each alternative
  • The special status of midstream agreements

Break

  1. ANDREW J. (DREW) CLOUTIER

    Partner Hinkle Shanor LLP, Roswell, NM

Trustee’s Avoidance Powers in Typical Industry Transactions and Common Defenses

  • The trustee as a hypothetical bona fide purchaser
  • Fraudulent transfers under the Bankruptcy Code and state law
  • Preferences, their elements, and common defenses in the oil and gas industry
  • Remedies for fraudulent transfers and preferences
  • Practical considerations in avoidance actions

  1. DEMETRA LIGGINS

    Partner Thompson & Knight, Houston, TX

Issues When a Fellow Working Interest Owner Files for Bankruptcy

  • Audit tools in bankruptcy, ownership of production proceeds, and JOA liens
  • When the operator is the debtor, including rights to the remove under the JOA, COPAS audit rights, ownership of production proceeds, claims for administrative priority, and abandonment
  • When the non-operator is the debtor, including JOA lien claims for unpaid LOEs, abandonment, and administrative claims for LOEs
  • Operator’s remedies for avoided payments

Break

  1. ELLEN M. CONLEY

    Associate Haynes and Boone, LLP, Houston, TX

Execution Against Oil and Gas Assets: What the Financing Party Can Do and When It Can Do It

  • Financing party options and strategies, including foreclosing on real property, as-extracted collateral, and stock, receiverships, and assignments for the benefit of creditors
  • Sabine and its implications
  • The role of forbearance agreements and waivers
  • Best practices and defenses for the borrower
  • Mineral leases in bankruptcy

Break

  1. CHRISTOPHER L. RICHARDSON

    Partner Davis Graham & Stubbs LLP, Denver, CO
  2. KYLER K. BURGI

    Davis Graham & Stubbs LLP, Denver, CO

Purchasing Oil & Gas Interests from a Distressed Company or Out of Bankruptcy: How to Survive (and Thrive) in a Bankruptcy Sale of Oil and Gas Assets or from a Distressed Company

  • Exit strategies and risks/benefits for the debtor and lender
  • The 363 sale process, including diligence, the stalking horse, bidding procedures, bid submission, auction, sale hearing, and closing
  • The liquidating plan/plan of reorganization process, including renegotiated versus prepackaged plans, and benefits of a plan versus the 363 sale for the buyer, debtor, and lender
  • What it means to be free and clear of liens, claims, and encumbrances; unextinguished liabilities, sale objections, and analysis of sale order provisions of recent sales
  • The asset purchase agreement/bid preparation process, including discussion of common terms from recent transactions

Course Adjournment