http://www.forbes.com/sites/ch ... 1739bThe pace of oil patch bankruptcies is picking up. According to a new count from Houston law firm Haynes & Boone, April saw 11 bankruptcy filings, the most of any month in the past two years. The headline failures that month were Ultra Petroleum, which buckled under $3.9 billion in debt, and Energy XXI, which carried debt of $2.9 billion.
All told, 69 oil and gas producers with $34.3 billion in cumulative secured and unsecured debt have gone under. Since share prices peaked in 2014, the oil bust has wiped out about $1 trillion in equity, with the Dow Jones U.S. Oil & Gas Index off 40%.
There’s more to come. “Despite the modest recovery in energy prices, all indications suggest many more producer bankruptcy filings will occur during 2016,” writes Haynes & Boone. According to Deloitte , about a third of global oil and gas companies, or about 175 of them, are at risk of insolvency. Bernstein Research estimates that by 2019 we’ll see more than $70 billion in defaults amid more than $400 billion in high-yield energy debt — that would indicate that we’re only halfway through the bankruptcies.
The biggest failure of the oil bust so far has been Canadian-listed Pacific Exploration & Production, which produces heavy oil in Colombia, and entered bankruptcy with $5.3 billion in debt.
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