ATP blames Gulf of Mexico moratorium for Chapter 11 bankruptcy
HOUSTON -- ATP Oil & Gas has filed a voluntary petition for reorganization under Chapter 11 to undertake a comprehensive financial restructuring.
In a news release, ATP said, "the primary reason for the reorganization began with the Macondo well blowout in April 2010 and the imposition beginning in May 2010 of the moratoria on drilling and related activities in the Gulf of Mexico. These events prevented ATP from bringing to production in 2010 and in early 2011 six development wells that would have added significant production to ATP, according to the release. As of the date of the banruptcy filing, three of these wells are yet to be drilled."
"Had ATP been allowed to drill and complete these wells, ATP believes it would have provided a material production change in 2010 continuing to today," continued ATP' s statement. "This projected increase in production should have substantially increased cash flows, shareholder value and allowed the company the ability to withstand normal operational issues experienced by owners of oil and gas properties in the Gulf of Mexico. In addition, these incremental cash flows would have mitigated or prevented the need to enter into many of the financings ATP has closed since the imposition of the moratoria—financings that require relatively high rates of return and monthly payments."
ATP has obtained a commitment for $617.6 million of debtor-in-possession (DIP) financing from members of its existing senior lender group, which will provide $250 million of additional funds and refinance into the DIP facility the amounts owed to those existing first lien lenders that participate in providing additional funds.
ATP Oil & Gas is an international offshore oil and gas development and production company focused in the Gulf of Mexico, Mediterranean Sea and the North Sea.