Even though 2018 was a fairly solid year for the oil and gas industry from a commodity price perspective, 29 North American producers with a combined debt of more than $13 billion declared bankruptcy.
In its annual update focusing on the oil and gas sector, Haynes and Boone LLP said a total of 167 North American exploration and production companies have filed for bankruptcy since the start of 2015. The total net debt of those companies, the firm noted, was nearly $96 billion.
Haynes and Boone noted that 24 companies filed for bankruptcy protection in 2017, with a combined net debt of over $8 billion.
Texas has seen the most bankruptcies in the 2015 to 2018 time period, with a total of 75 filings and a combined net debt of more than $47 billion from companies headquartered in the state. Delaware, which has no oil and gas production but is a popular headquarters for companies, reported 26 bankruptcies with a combined net debt of more than $22.6 billion.
Bankruptcies slowed in the second half of 2018. A total of 16 companies filed in the first half, with 13 after June 1. Seven producers filed for bankruptcy during the fourth quarter.
The company with the largest net debt to file for bankruptcy in 2018 was Fieldwood Energy LLC, which reported debt of more than $3.3 billion. Exco Resources, which was the first producer to file for bankruptcy last year, was second with a net debt of just over $3 billion. Both filed for bankruptcy protection within the first six weeks of the year.