42 Energy Companies Went Bust In 2015 Under $17 Billion In Debt; Now Can't Give Their Assets Away

[hatrack]

EDIT

Winners and losers are emerging from the energy bust. What’s a meal for Clark is indigestion for banks that financed the boom using oil and gas properties as collateral. The four biggest U.S. banks -- Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. -- have set aside at least $2.5 billion combined to cover souring energy loans and have said they’ll add to that if prices stay low. There’s plenty to keep Clark bargain-hunting. Last year, 42 U.S. energy companies went bankrupt, owing more than $17 billion, according to a report from law firm Haynes & Boone.

Dune went belly up owing $144.2 million. Its assets sold for $20 million. In May, American Eagle Energy Corp. filed for bankruptcy with debts of $215 million. Its properties sold for $45 million in October. BPZ Resources Inc. owed $275.2 million. Its assets fetched about $9 million. Endeavour International Corp. went into bankruptcy owing $1.63 billion. The company sold some assets for $9.65 million and handed over the rest to lenders. ERG Resources LLC opened an auction with a minimum bid of $250 million. Response? No takers.

“A lot of people got into this business and didn’t really understand the ups and downs of price cycles,” said Becky Roof, a managing director for turnaround and restructuring with the consulting firm AlixPartners. “They’re getting a very bad dose of reality right now.”

EDIT

Bankruptcies are accelerating. Magnum Hunter Resources Corp., Swift Energy Co. and New Gulf Resources filed in December. With more liquidations hitting the market, bargain hunters may not be willing to pay top dollar when there are so many deals to be found. The next test will be the auction of Quicksilver Resources Inc.’s properties, scheduled for Wednesday. The shale driller declared bankruptcy in March with more than $2 billion in debt. “So much of the frenzy in shale in the past few years was a result of the money pouring out of Wall Street,” said Clark of White Marlin. “It was as much a Wall Street play as it was an oil-and-gas play. It was putting money to work. Companies took on all that risk and now we see the result.”

EDIT/END

http://www.bloomberg.com/news/articles/2016-01-20/some-bankrupt-oil-and-gas-drillers-can-t-give-their-assets-away

[KoKo]

1. Another Bubble Bursts....

And, yet the banks can take a hit like this?

[kristopher]

2. There are some shady goings on in the coal industry.

First thing I saw on the topic:

Walter Energy strikes deal to sell remaining U.S. assets
Feb 1, 2016, 10:11am CST

Ryan Phillips
Digital Producer
Birmingham Business Journal

Walter Energy Inc. has struck a deal to sell its remaining non-core U.S. assets to affiliates of Virginia Conservation Legacy Fund Inc. – a nonprofit organization seeking sustainable approaches and public awareness about natural resource use.
The deal, which follows Walter's bankruptcy filing in July 2015, involves all of the company's U.S. assets excluded from its previously announced deal with its senior lenders to acquire core assets like its main mine in Brookwood. The company's Canadian and U.K. subsidiaries are excluded from the deal, as well.
Walter agreed to sell the assets, which includes the local Walter Coke Inc. facility on 35th Avenue North, as well as property in West Virginia, to Seminole Coal Resources LLC, ERP Compliant Coke LLC and ERP Environmental Fund Inc. All are related to ERP Compliant Fuels LLC, which is an affiliate of the VCLF....

http://www.bizjournals.com/birmingham/news/2016/02/01/walter-energy-strikes-deal-to-sell-remaining-u-s.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+bizj_birmingham+%28Birmingham+Business+Journal%29




Second ...

Kissito’s Virginia Conservation Legacy Fund Purchases Virginia’s Natural Bridge
Posted on February 6, 2014 by jmcgilliard
Natural BridgeNatural Bridge, VA- A newly formed conservation nonprofit called the Virginia Conservation Legacy Fund, Inc. has purchased the Natural Bridge of Virginia with the intent of improving the property and establishing it as a Virginia State Park.

Thanks to a major donation by the owner, Mr. Angelo Puglisi, and a significant loan from the Virginia Clean Water Revolving Loan Fund Land Conservation Loan Program, the Natural Bridge will for the first time in its history be transferred into public ownership. The transaction could not have taken place without the hard work, cooperation, and commitment of the state and county government, local nonprofits, and individuals who all played a role in pulling together this unusually complex and important project to benefit the citizens of Virginia now and in the future.

“This is truly an historic day for an extraordinarily special place. Thanks to the efforts of many individuals and organizations, this priceless natural and historic wonder will be available for the enjoyment of generations to come,” stated Faye Cooper, Executive Director of the Valley Conservation Council, a regional private land trust that has provided technical support for the project since its inception.

“Our vision for Natural Bridge is to be the center piece of the state park system. We want Natural Bridge to become a family destination resort that represents the essence of outdoor recreation, historic preservation, and environmental conservation in Virginia.”, Tom Clarke CEO, VCLF.

Natural Bridge will undergo a transformation of the buildings, grounds, and land to emphasize the history and ecology of the site plus develop the outdoor recreation potential of the property...

http://www.kissito.org/kissitos-virginia-conservation-legacy-fund-purchases-virginias-natural-bridge/

Then this from the stock market scene...

Does This "Clean" Idea Breathe New Life into Coal?
Can the Virginia Conservation Legacy Fund's coal mining model save the U.S. coal industry?

Reuben Gregg Brewer (ReubenGBrewer) Oct 25, 2015 at 2:15PM
Bankrupt Patriot Coal is selling coal mines to an environmental group, the Virginia Conservation Legacy Fund. Only this group plans to keep running one of the two mines it's buying, creating "clean" coal with carbon credits. Is this a new model that could save the U.S. coal industry from extinction?

Coal is dirty
One of coal's biggest problems is that it's among the dirtiest carbon fuels around. A lot of money has been spent trying to clean it up, to much success, but it's still one of the dirtiest options for generating electricity. The big thing right now is the carbon dioxide that coal burning releases and the impact that has on global warming.


To be fair, coal is losing out to other fuels for more than just environmental issues. For example, natural gas is cheap right now so it has increasingly been displacing coal in the power picture. And the cost of "clean" options like solar and wind has been coming down, making them more and more competitive, too. However, coal still makes a significant portion of the power we consume and provides important fuel source diversification for power companies. It's expected to remain an important part of the power space for years to come.

So Patriot Coal's deal with the Virginia conservation group is interesting because the plan is to keep mining for coal from one of the two mines that are part of the deal while at the same time creating carbon credits through land reclamation efforts. By bundling the two together, the Virginia Conservation Legacy Fund is hoping to create a "compliant" carbon fuel alternative for utilities.

Not exactly clean...

http://www.fool.com/investing/general/2015/10/25/does-this-clean-idea-breathe-new-life-into-coal.aspx


It's an obvious scam to misuse the system in order to support the coal mines. If anyone finds more detailed information about the way this works to the benefit of the coal industry please share.