GMX files for Chapter 11 bankruptcy protection
From the Houston Chronicle.
Oil and gas producer GMX Resources Inc. said Monday that it filed for Chapter 11 bankruptcy protection, blaming low prices for natural gas.
The Oklahoma City company filed in the Western District of Oklahoma. The filing includes its Endeavor Pipeline and Diamond Blue Drilling units. It does not include Endeavor Gathering LLC, a business in which GMX holds a 60-percent interest.
GMX says it pursued several strategies to increase oil production, make its supply chain and production more efficient, and reduce costs. However the price of natural gas has remained low and the company’s oil and gas businesses require more spending. GMX said it hasn’t been able to find any long-term solutions to its financing needs.
GMX says it agreed to sell its operating assets and undeveloped acreage to the owners of company senior notes that are due in 2017. Those assets will later be subject to a public auction.
The senior note holders have committed $50 million in debt financing to cover its operating expenses.
The company expects the New York Stock Exchange to begin delisting procedures for its stock. It does not plan to contest those proceedings.
Shares of GMX Resources have traded between $1.80 and $21.84 in the last year, and they closed at $2.19 on Friday.
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Replies to This Discussion
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Permalink Reply by adubu on
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Andrew--JHH----BANKRUPTCY (This is copied from Texas RRC website)----If royalty owners is not being paid he must file a claim with court-- you must have a lawyer to help you ASAP--- You are a unsecure creditor you will need to file a Lien on the well/property of your lease identified by your DO and operator------- IF YOUR LEASE HAS BEEN SOLD TO ANOTHER OPERATOR THEN YOU OK FOR NEW OPERATOR TAKES OVER AND WILL CONTINUE TO PAY YOU YOUR ROYALTY> WHICH I UNDERSTAND GMX HAS SOLD MANY OF THEIR PROPERTIES
If an operator with whom you are involved has declared bankruptcy, there will be a bankruptcy case pending in a federal bankruptcy court. There are many bankruptcy courts in Texas, divided into four main districts. A court-appointed trustee generally will be in charge of handling the bankruptcy. Your claims and complaints should be addressed to the trustee. The bankruptcy case most likely will be pending in a court nearest the principal office of the business. The clerk of the bankruptcy court can give you further information.
The Northern District includes Abilene, Amarillo, Dallas, Fort Worth, Lubbock, San Angelo, and Wichita Falls:
Clerk, U.S. Bankruptcy Court 1100 Commerce St., Room 14-A-7 Dallas, Texas 75242
(214) 767-0814
The Eastern District includes Beaumont, Lufkin, Marshall, Paris, Sherman, Texarkana, and Tyler:
Clerk, U.S. Bankruptcy Court 211 West Ferguson Tyler, Texas 75702
(903) 592-1212
The Southern District includes Brownsville, Corpus Christi, Galveston, Houston, Laredo, and Victoria:
Clerk, U.S. Bankruptcy Court 515 Rusk, Room 4603 Houston, Texas 77002
(713) 250-5500
The Western District includes Austin, Del Rio, El Paso, Midland, Pecos, Waco, and San Antonio:
Clerk, U.S. Bankruptcy Court P.O. Box 1439 San Antonio, Texas 78295
(210) 229-6720
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Permalink Reply by adubu on
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JHH--Yep it a mess --hope this info helped--- but for all that reads this it is just that ---"some information and not Absolute legal facts" simply some info to go on - if royalty owners checks stop and not paid -- then visit a knowledgeable Attorney who deals with oil & gas royalties when their operator files Bankruptcy---if they sell the wells and leases and another operator takes over and check pay royalty per your DO then I think you are ok and continue on down the road of life
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Permalink Reply by JHH on
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adubu: I have a thought... not sure i have the resources to pursue. If a royalty check bounces... couldn't that be considered as a lease violation and cause it to be null and void. Just a thought. jhh
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Permalink Reply by tc on
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Another outcome is that the bankruptcy judge allows the company to do away with lease obligations that are harmful to the company and beneficial to you the landowner. Ever heard of union busting thru bankruptcy. Bankruptcy judges have almost absolute power. The good thing is that GMXR isn't like ENRON, which was an accounting house of cards.
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Permalink Reply by adubu on
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JHH--if check bounced and royalty not paid and well continue production yes you would think that may violate lease but that a question only Attorney can answer for you. If that happen ask for legal help with attorney. For us to answer with only our opinions these type questions with unqualified credentials would only be for "what If" Games and not in members of site best interests who reads these post for help. They could get bad info.
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Permalink Reply by JHH on
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abdu: you're right. just wondering. will ask attorney. but i'm thinking the answer will be.. how long do you want to fight and how much money do you want to spend on a case that might not be resolved in my favor. we'll see. thanks, jhh
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Permalink Reply by JHH on
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i received one last month. but i know some people whose check bounced.
jhh
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Permalink Reply by JHH on
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just got a letter from East Texas Exploration which said it purchased the Cotton Valley wells held by GMX... and said i'd be paid by them for those wells for now on... i guess until they sell them.
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Permalink Reply by adubu on
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JHH -- you have any thing deeper than CV that is HBP or depth Pugh clause in your lease or all depth HBP by the CV. If all your leases sold then you have new operator and they will have to honor your lease language and DO. If you getting paid by new operator then you have no problem and nothing to do other than review your check and make sure all if any deduction same as with GMX and your decimal interest correct. If all checks out correct bank it and go on down road but always monitor every check. I have one unit that has been sold to different operator 4 times in last 11years. Every time checks continued correctly. It's good deal that GMX sold your lease and wells so you are out of Bankruptcy problem with new operator
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